The economic picture in Kansas is more nuanced than a simple look at the unemployment rate suggests, revealing a state with potential hampered by policy choices. While the unemployment figure remains competitive, a deeper dive into labor market dynamics and economic output reveals a state capable of greater growth, but one that appears to be holding steady rather than surging forward.
According to the latest state labor-market data, Kansas’s unemployment rate stood at at 3.8%, below the national average of 4.4%. This represents a relative strength, particularly given the unpredictable nature of federal economic policy. However, analyzing the past twelve months reveals a more complex reality. The state’s labor force grew from 1,554,666 in to 1,572,551 in , an increase of 17,885 individuals. Simultaneously, the number of unemployed Kansans rose from 59,082 to 59,742, a gain of 660, while the unemployment rate remained static at 3.8%.
This combination suggests that Kansas is successfully absorbing a growing workforce without a significant increase in unemployment. However, it also indicates that job growth is not accelerating rapidly enough to substantially reduce the unemployment rate, even with increased labor force participation. Kansas is maintaining its position, rather than forging ahead.
In , Kansas’s 3.8% unemployment rate mirrored that of Colorado, slightly outperformed Missouri’s 3.9%, and remained lower than Nebraska’s 3.0%. This regional comparison underscores the challenge: Kansas cannot build a sustainable growth strategy on simply being average.
However, when examining economic output, Kansas demonstrates a clear advantage. The latest state GDP release shows Kansas posting the fastest real GDP growth in the country in the third quarter of : 6.5% at an annual rate, compared to the national average of 4.4%. Kansas led the nation in personal income growth at 6.3%, significantly exceeding the national rate of 3.3%. This level of performance is not typical and highlights Kansas’s potential.
The Bureau of Economic Analysis (BEA) data indicates that agriculture was a primary driver of GDP growth in Kansas, alongside durable-goods manufacturing, which increased across all states. This suggests that Kansas’s economic success in this period was not fueled by government spending, but by productive output.
The question then becomes: why isn’t this strong output translating into more significant gains in the labor market? The answer lies in the need for a long-term, consistent strategy. A single strong quarter is insufficient. Businesses require confidence in the future, considering factors such as taxes, spending levels, regulations, energy costs, and the stability of future legislative policies.
Current Kansas policy, particularly under Governor Kelly, has been criticized for lacking this long-term vision. Instead of solidifying its competitive edge, the state has often opted for expanding government programs and defending the status quo, framing these actions as “investment.” While such measures may generate short-term headlines, they do not guarantee sustained growth.
A different approach is needed, one that prioritizes rules-based constraints on government spending and incentives for work. Specifically, the implementation of a strict spending limit tied to population growth plus inflation is proposed. Without such a cap, any tax relief is vulnerable to being offset by future spending increases. Any surplus revenue should be used to reduce income tax rates, recognizing that surpluses represent excess collection under a responsible budget. Permanent tax reductions are favored over temporary spending initiatives.
Addressing property tax pressures requires a fundamental shift away from targeted exemptions and towards controlling overall spending growth at the local level. The root cause of high property taxes is spending, and lasting relief can only be achieved by restraining that spending.
Kansas possesses the capacity to lead, as demonstrated by its recent economic performance. However, this leadership will not materialize automatically. It requires a commitment to capping spending, reducing taxes with surpluses, and empowering Kansas producers and workers to retain more of their earnings. The state’s current trajectory suggests a need for a more decisive and long-term economic strategy to fully capitalize on its potential.
