Packers win! Now, can the Wisconsin economy aspire to its own Super Bowl? | submitted by Tom Still
The Green Bay Packers have just proven that a team from professional football’s smallest market can rebuild from within, overcome adversity, and win when it matters. Let’s hope the still-struggling Wisconsin economy has the potential to do the same.
While the state’s seasonally adjusted unemployment rate is nearly two percentage points lower than the national jobless rate of 9.4%, other indicators continue to signal Wisconsin is far from out of the woods. Bankruptcy filings climbed in 2010 for the fourth straight year, per capita wages and average wages remain well below the U.S. average, and the state’s Gross Domestic Product as a share of the U.S. total continues to slide.
The turnaround may well be coming, but in the competition to win its own "Super Bowl" of economic prosperity, Wisconsin begins the game down on the scoreboard.
Recent figures from the U.S. Bureau of Economic Analysis show the recent recession didn’t hit all regions of the nation with equal force — in fact, it struck the Great Lakes states harder. Real domestic growth in the five-state region that includes Illinois, Indiana, Michigan, Ohio and Wisconsin fell 3.4% between 2008 and 2009, the most of any region tracked by the federal government. That decline was about three times larger than the drop in the Plains states (1.2%) for the same period.
According to a report from the Midwestern office of the Council of State Governments, the decline in the durable goods manufacturing sector stood out the most. Michigan, Indiana, and Wisconsin posted the highest percentage-point declines in that sector among the 50 states. Since March 2000, the peak month for manufacturing employment in Wisconsin, the state has lost about 160,000 jobs.
It wasn’t just a recession-only phenomenon. For at least a decade before the recession, GDP growth in the Great Lakes states was lagging the nation and virtually every other region. From 1998 to 2002, the Great Lakes states showed GDP growth of 1.7% while the nation stood at 3%. The region’s growth fell to 1% in 2003 through 2007, declined by 0.6% in 2007-2008 before tumbling 3.4% in 2008-2009.
In contrast, the seven Plains states grew at nearly the U.S. average from 1998 to 2007 and leaped ahead in 2007-2008. The Plains states’ GDP decline in 2008-2009 was about half of the national average. The comparison is justified because those seven states — Iowa, Minnesota, North Dakota, South Dakota, Kansas, Missouri and Nebraska — aren’t all that different in culture, geography, and economic mix.
How can Wisconsin begin the process of rebuilding its economy? There’s no single answer, of course, but many suggestions can be found in the goals of "Be Bold: The Wisconsin Prosperity Strategy," a report issued late last year by the conveners of the Wisconsin Economic Summit.
A leaner, more efficient government is part of the mix, as Gov. Scott Walker and the Wisconsin Legislature certainly know as they confront a $136.7 million deficit for the remainder of this budget year ending June 30, and a $3.6 billion gap for the following two years.
The other side of the equation is stimulating growth, which Walker and the Legislature have tried to do with some of the tax and regulatory relief bills passed so far this year. It cannot stop there, however. The strategy must also include building on the state’s research and development foundation; encouraging exports from leading industry clusters; creating an environment that nurtures entrepreneurs and early-stage companies; and making sure Wisconsin is educating, retaining, and attracting the right workforce.
Just like the Packers’ Super Bowl team was rebuilt one player at a time over many seasons, the state’s economy must be retooled through strategies designed to attract talent, capital, and ideas. Wisconsin has demonstrated it can build a championship team in football — it can do the same when it comes to jobs and the economy.
Still is president of the Wisconsin Technology Council. He was a co-author of "Be Bold: The Wisconsin Prosperity Strategy," which can be found at www.wisconsintechnologycouncil.com/newsroom.
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