The Indianapolis Star recently published a lengthy expose of Indiana’s workplace inspection program. The authors detailed what appears to be COVID-specific failures that caused Indiana to plummet into last place nationally with safety inspections. This report darkens what was overall a superb COVID response by Gov. Eric Holcomb’s administration.
The drop in safety inspections accompanied a spike in workplace deaths that began long before COVID. Between 2010 and 2020 worker deaths rose by 30%. As national workplace death rates declined, Indiana’s slid to levels not seen in three or four decades.
This disgraceful outcome is too large to be a statistical anomaly or by-product of careless inspections during COVID. It is part of a broad policy shift that emerged shortly after the Great Recession, and continues to this day. It affects the U.S. Department of Labor’s inspection and safety programs, and more visibly our approach to worker training and education as a whole. This policy shift has cost lives of Hoosiers. It has also weakened our economy. Let me explain the genesis of this failure.
Sometime after the Great Recession, deep budget cuts at the state level began to take a toll on the effectiveness of state government. Former Gov. Mitch Daniels made enormous progress in improving those agencies with transactional-type missions. So, the BMV became a national showpiece of excellence. But, most of state government is not transactional. Family and social services, education, workforce development, environmental management and workplace safety are all public services that require a more complex service model. Fast, friendly service is not sufficient to their mission.
However, the problem wasn’t just nuanced management practices. Sometime after the Great Recession, Indiana’s workplace safety, workforce development and educational policy made a concrete and purposeful shift to support only the short term needs of businesses. This was an amateurish error that continues to hobble our economy.
I’m deeply sympathetic to the needs of business. I’ve published studies arguing against the minimum wage, critiqued overreaching regulation and published a peer review study critical of Right to Work legislation in the libertarian Cato Journal. Commerce is essential to prosperity. The free exchange of goods and services, especially one’s labor, form the basis for human flourishing.
However, in the years after the 2007-2009 downturn, Indiana’s government made a dramatic move away from its Constitutional duties, to instead service the short term needs of a few businesses. The best evidence of this comes from the Indiana Department of Workforce Development which, around 2015, changed its mission from supporting worker training to supporting the workforce needs of just a few businesses.
This approach has three weighty problems. First, government service is accompanied by an oath to the Constitution. This means focusing on legal duties, not the worries of a few outspoken employers. The mission change at Workforce Development is inconsistent with that oath of office.
Second, shifting the focus of government from workers or taxpayers to businesses, has manifested itself in deeply ineffective practices. For a decade, Indiana’s DWD has ignored data about long term labor market trends. This caused them to persistently mislead Hoosiers about the demand for jobs, and misrepresent the need for post-secondary education. This likely played a role in our growing educational deficit.
The third troubling aspect of Indiana’s workforce policy is that it failed on its own measures of success. Since the end of the Great Recession, Indiana’s economy has grown at little better than half the rate of the nation as a whole. Our incomes and education levels declined relative to the nation, making our long term economic prospects worse than they’ve been in a more than a half century. The goal of the post-Great Recession reforms was simply to boost economic growth. By that measure alone, it failed.
It is time for a change. Indiana’s state government should be sensitive to the needs of business, and of workers. But, it must serve the interest of all taxpayers. The policies of weakening workplace safety, abandoning Daniels’ aspirational education goals and downplaying the need for post-secondary education has slowed economic growth in Indiana.
Just to be clear, none of these changes were made with malicious intent. The goal was always to make Indiana a more prosperous state. But, intent is not enough. A modern economy requires high quality public services. That cannot be achieved solely with fast service and a friendly smile. The growing weakness across Indiana’s workforce development, education and worker safety domains highlights a broader problem that needs focused, intelligent attention.
Michael J. Hicks, PhD, is the director of the Center for Business and Economic Research and the George and Frances Ball distinguished professor of economics in the Miller College of Business at Ball State University. Hic column appears in Indiana newspapers.