Workers and Policy Publications

Wisconsin’s dramatic March job growth was nearly erased by equally dramatic job losses in April, as the state lost nearly 13,000 jobs. The private sector lost 11,500 jobs and the public sector fell by a little more than 1,000. Manufacturing losses of 4,200 jobs were particularly severe. And in contrast to the overall decline, construction gained 3,500 jobs last month. All in all, the unemployment rate in Wisconsin dropped one tenth of a percentage point and stands now at 4.4%. Additionally, over the last year, Wisconsin’s job growth lags behind some of its Midwest neighbors: while Michigan and Indiana have grown at a pace of 2.5% and 1.6% respectively, Wisconsin has grown at a pace slower than 1.5%.

The economy is growing again, but gains are concentrated on the state’s richest residents. As in the nation, inequality is on the rise. Over the last 40 years, Wisconsin’s richest residents have experienced dramatic increases in income, yet the rest of the state’s residents have experienced little or no income growth. The widening chasm between the very highest earners and everyone else poses hardships for Wisconsin’s families, businesses, and communities. Families can’t thrive when income growth is nearly non-existent for everyone except those at the top, and businesses need a strong middle class bolstered by broad-based income growth to generate customers. Wisconsin communities pay the price if too many families and businesses fail to prosper. Growing income inequality is also bad for Wisconsin’s economic growth. To build a solid, fast-growing economy, we need to make sure that Wisconsin has a healthy, well educated workforce. But if nearly all the gains from economic growth benefit only a few, many Wisconsin residents won’t have the resources they need to become the kind of skilled workers our economy needs for the future. That hurts everyone.

In April COWS reported a dramatic job loss of more than 10,000 jobs. This month, the labor market brings better news, with increases that move us back in the right direction. Since last month, Wisconsin added 5,500 jobs. This increase was driven by private sector job growth where 9,700 jobs were added. At the same time, some 4,200 government jobs were lost between April and May. The unemployment rate in Wisconsin dropped two tenths of percentage points and stands now at 4.2%.

The State of Working Wisconsin 2016 uses the best and recent data available on jobs and wages to describe the economic challenges that Wisconsin continues to face.

Wisconsin’s unsteady labor market finally added jobs in July which offers good news in the face of the decline in jobs since March. In June, Wisconsin had the same number of jobs that it had at the beginning of the 2015 which was also and finally the same as number the state had before the recession began (December 2007). Over the last two months of summer, July and August 2015, some 20,000 jobs were added in the state. Wisconsin is now solidly above pre-recession levels, and also hopefully on a consistently positive job growth path as well. It is good news that Wisconsin’s labor market is finally larger than it was nearly 8 years ago. Still, the potential labor force in the state is much larger than it was in the past, and the jobs we have today are not sufficient to keep up with our population growth. As Figure and Table 1 make clear, Wisconsin still faces a significant jobs deficit and needs stronger growth to fill that gap. In order to simply provide the same opportunity that we had in 2007, Wisconsin’s “jobs deficit” now stands at around 102,000 jobs.

After a very dramatic loss in the number of jobs in the month of May, June brings slightly better news for the state of Wisconsin. In June, the state added 1,900 new jobs. On net, however, the Wisconsin job market of 2015 has been largely stagnant. Last month, in the middle of the year, Wisconsin posted 2,882,000 jobs, a number only slightly higher than the state’s January count. And, in fact, the number is just barely higher than the number of jobs Wisconsin had when the recession began over seven years ago. And because the population of the state has grown over those years, Wisconsin remains substantially short of the number of jobs needed to keep opportunity in line with 2007 levels. The Wisconsin “jobs deficit” still stands at 115,700. At the current rate of growth, it would take Wisconsin another 5 years to fill our jobs hole.

Wisconsin’s growth and prosperity are not being widely shared. Over the last 40 years, Wisconsin’s richest residents have experienced dramatic increases in income, while Wisconsinites not among the very highest earners saw little or no income growth. In 2012, Wisconsin reached a milestone, with a record share of income going to the top 1%.

The upward trend in Wisconsin continued in September. Data from the Bureau of Labor Statistics show that Wisconsin added 1,400 jobs that month. The pace of job growth in September was much slower than that established in the previous two months when Wisconsin added14,000 (in July) and 7,000 jobs (in August). Still it is good to see consistently positive numbers, even if a slow pace. In Wisconsin, eight years after the beginning of the Great Recession, the number of jobs is, at last, defintely and consistently above the pre-recession level.

However, since the population of the state has grown steadily since the end of the recession, our labor market still has not fully recovered. If we aspire to the same level of opportunity that Wisconsin had before the recession we need to create jobs on pace with population growth. As our job market has not kept pace, Wisconsin still shows a deficit of 102,000 jobs.

Jobs data from the Bureau of Labor Statistics show an increase of 16,000 jobs in Wisconsin this past month. While statistics are subject to monthly revisions, and the exact figure might change, this substantial increase is significant and likely to remain the best month for job growth of 2015. This increase in jobs is very good news for the Badger State which has been on a weak trajectory since the recovery began. Wisconsin now is firmly and consistently posting a job count well in excess of the number of jobs the state had on the eve of the Great Recession (December 2007).

Because the population has grown since the Great Recession, just getting back to the 2007 job base doesn’t provide the same sense of opportunity, however. For the labor market to provide the same level of opportunity for our current population, the state job market is still 95,000 jobs short. In fact, even if this strong rate of job growth were maintained –a difficult feat in itself–the state is still half a year from recovering to the level of opportunity in 2007.