Wisconsin should be the next U.S. regional tech hub
During the coming months, it’s anticipated that the U.S. government’s CHIPS and Science Act will authorize $10 billion to invest in six regional innovation and technology hubs across the country. The funding will create jobs, spur regional economic development, and position these hubs to lead the nation in high-growth, high-wage sectors. Based on Wisconsin’s track record, we should be one of these hubs.
Wisconsin enjoys a strong economy, buoyed by core industries such as agriculture, defense manufacturing, food and beverage, transportation, and manufacturing supply chain. But there’s another industry that stands poised to make a major transformation of our state’s economy — biohealth.
Wisconsin’s biohealth industry is already among the key economic engines that drives our state’s overall economy, generating an economic impact of $32 billion in direct, indirect, and induced services, according to the most recent Wisconsin Biohealth Industry Landscape and Economic Impact Report (2022). That translates into $1.2 billion in state and local taxes annually.
Under the biohealth umbrella are entities including biotech and biopharma, medical device and diagnostics, digital health sectors, and the state’s significant research institutions. Combined, they directly employ nearly 52,000 individuals statewide, 25,000 of which are located in Dane and Rock counties.
This includes Wisconsin’s comprehensive and leading UW Research & Development (R&D) engine which, in 2019 and 2020, surpassed $1 billion in annual expenditures. An important statistic to note is that biohealth-related R&D innovation in Wisconsin has outpaced the U.S. in growth since 2018, which speaks directly to the vibrancy of innovation within the state.
Other examples of that vibrancy include Madison-based Exact Sciences. It recently acquired Prevention Genetics in Marshfield and they are working together to accelerate the availability of hereditary cancer testing. Meanwhile, GE HealthCare, with locations in Madison and Waukesha, has invested in a new factory in Milwaukee to create the components for CT and PET scans, expanding its business development opportunities and creating new jobs for Wisconsin residents.
When you factor in that the biohealth industry has an employment multiplier effect of 2.5, meaning that every Wisconsin biohealth industry job generates and supports an additional 1.5 jobs, you’re now looking at more than 129,000 industry related jobs statewide, with 63,000 of them in Dane and Rock counties alone.
In addition, the biohealth industry has experienced 10.6% job growth since 2018, far outpacing the state’s overall job growth of negative 2.7%. The good news is that there’s plenty of room for continued growth within biohealth. The not-so-good news is that current trends show that by 2030, Wisconsin will have dire a workforce shortage.
One way to reverse that trend is by aggressively highlighting Wisconsin’s powerful key industries nationwide and beyond, especially the biohealth industry. It will showcase our state’s strengths, resiliency, and opportunities for leading-edge growth. The strategy should include tactics to attract companies and talent to our state by generating increased awareness of Wisconsin’s manufacturing capabilities, with a focus on a long-term plan that not only maintains but grows these key industries and those that support them.
But it will take more than just spotlighting our strong industries to become a tech hub. We need to ensure that companies and talent looking for a place to call home know about the quality of life our state has to offer, with strong schools, technical colleges and the university system, affordable housing, natural and environmental beauty, significant resources including an abundant source of quality water, strong infrastructure with direct access to national and international markets, and a collaborative spirit that helps fuel company success, employment opportunities, and financial security.
There is no doubt we will have strong competition in the race to become a regional tech hub. States like Pennsylvania, North Carolina, South Carolina, Tennessee, and Georgia are likely to be among the competitors. They realize the economic impact of the biohealth/biotech industry and are already actively investing in efforts to attract companies to their respective states — experiencing positive results. Wisconsin must follow suit or risk losing out on this prime opportunity.
It is essential that our outreach strategy promote our state as a whole, focusing on our combined strength and a powerhouse manufacturing sector and supply chain that makes Wisconsin ideal for welcoming growing companies that are looking for new locations, including those companies hoping to reshore existing work.
Without a cohesive, long-term statewide strategy in place, there is a limit as to how much growth, talent attraction, and retention can be achieved. The strategy should include an initiative to secure not only federal, but also state and local funding to become the next regional tech hub. It’s an effort that requires us to work together for the greater good. To make it happen, we’ll need bipartisan support from our congressional and state lawmakers, local governments, business leaders, and communities.
As we support this effort, we must also continue to support Wisconsin’s current biohealth/biotech industry leaders. Encouraging their success will also lead to additional job opportunities, incentivize talent, and encourage more entrepreneurs to launch in our state. It will also be the catalyst for enticing other companies to locate or start here.
Ultimately, the growth opportunities for Wisconsin in biohealth is immense, particularly in the broader national context of bolstering domestic production and supply chains as priorities for critical industry sectors such as biopharmaceuticals and medical imaging.
It’s up to Wisconsin’s leaders to recognize the state’s unmatched manufacturing and supply chain capabilities and to collectively promote them to a national and global audience, highlighting Wisconsin as “THE” place for companies to develop, grow, and thrive.
On behalf of Wisconsin’s biohealth/biotech industry, you can count in BioForward Wisconsin as part of that effort. The future of our state’s economy depends on it.
Lisa Johnson is CEO of BioForward Wisconsin, a Madison-based organization serving as the collective voice of Wisconsin’s biohealth industry and representing more than 220 member organizations.