January 29, 2025 - On Wednesday, Governor Mike Kehoe delivered his first State of the State Address to the Missouri General Assembly, outlining his legislative and budget priorities for Fiscal Year 2026 (FY26). He covered the issues of public safety, agriculture, and education, along with a focus on economic development for the state.
Governor Kehoe understands that taxes and unreasonable regulations hinder business growth and development. Businesses tend to migrate toward states with lower tax and regulation burdens. According to the press release, “In order to compete with other states, the Kehoe Administration will focus on reducing taxes and cutting regulations, so families keep more of their own money, and so job creators look at our state to expand and hire more hard-working Missourians.”
True economic growth does not happen only within major cities. The expansion of business opportunities within the rural community is vital for our state and is tied to having proper infrastructure within those communities. The Governor's press release also stated that, “Knowing that infrastructure and economic development go hand in hand, Governor Kehoe's budget includes a reappropriation of last year’s 100 million dollars for rural road improvements to ensure all those funds are invested in rural infrastructure.”
In concert with lowering the tax and regulation burdens for businesses, and making sure we have proper infrastructure, Governor Kehoe understands that the state must provide a favorable economic environment in which to attract workers. Governor Kehoe announced that, "he has directed the Missouri Department of Revenue to work with his staff on a sustainable and comprehensive plan to eliminate the individual income tax once and for all.”
For some people, money isn’t everything. The top concern for many potential workers is taking care of their children while they remain employed. One of the biggest ways to attract workers in today’s economy is to have prevalent, competent, affordable child care available. Many states, including Missouri, face child care deserts that make it extremely hard for people to work and for industry to grow.
According to the press release, “Governor Kehoe's speech focused largely on solving the biggest challenge to the child care crisis: addressing the current regulatory environment. In an effort to make the child care regulations easier to understand and navigate, Governor Kehoe issued Executive Order 25-15, charging the Department of Elementary and Secondary Education-Office of Childhood with a complete re-write of the child care regulations.”
But the Governor did not stop there as he sees the benefit of empowering businesses to help their employees in this area, as well as communities who want to attract workers with affordable child care availability. It was announced that “the budget also includes $10 million to offer grant funding opportunities to support partnerships between employers, community partners, and the child care industry to make more child care slots available for Missouri families.” It is hoped that these actions will create a more robust child care industry for Missouri.
A foundational building block for any workforce is education. The trend for post high school education has been trending away from four-year college degrees and toward technical school. Many see this as a way to quickly build the skilled labor needed for manufacturing and other job areas. During the speech it was announced that, “To build on Missouri's career and technical education opportunities, Governor Kehoe's budget includes $15 million in new funding to address equipment, space, and operational needs of career and technical centers across the state, as well as an increase of $5 million on an annual basis to support increased operational costs.” With this boost, technical schools will be able to expand the number of students they serve, thereby increasing the available workforce in the state.
However, the education track cannot be left until after high school graduation. Early guidance and development are important for helping students decide if a technical school path is right for them. “The budget includes increased funding to expand career counseling to more high schools across the state, so that students can talk to school counselors about their future career path, whether that includes college or not.”
Finally, the Governor recognizes that government cannot do everything. Those who are stakeholders in the future development of the Missouri workforce can produce a wider variety of ideas and programs to help in that development. The press release pointed out that “Governor Kehoe also signed Executive Order 25-16 establishing the Governor’s Workforce of the Future Challenge, instructing DESE to put a plan in place for better coordination among key stakeholders, including K-12 schools, local business and industry, and higher education to improve the state’s career and technical education programs and infrastructure.” These stakeholders can create programs that better meet the needs of industries and students as they work within the communities on a daily basis.
"Associated Industries of Missouri applauds Governor Kehoe's plan for lowering taxes, increasing the availability of quality child care to allow more parents to work, his continued longtime commitment to infrastructure improvement, and his commitment to programs that will better connect educational resources with the workplace and we will assist Governor Kehoe with all of these priorities in any way he sees as beneficial," said Ray McCarty, president and CEO of Associated Industries of Missouri.