By M.D. Kittle
MADISON — Wisconsin has seen a resurgence in its bedrock manufacturing sector over the past several years thanks in no small part to pro-growth, limited government policies.
But Wisconsin’s grow-government governor, Tony Evers, has in his first nine months in office attempted to raise taxes on manufacturers and has rolled out regulations that industry experts say will hurt manufacturing.
The manufacturing sector which employs 16 percent of Wisconsin’s work force in family-supporting jobs, is under fire and feeling the effects of uncertainty, an industry expert says.
A new report from the Institute for Reforming Government (IRG), details the importance of manufacturing on Wisconsin’s economy just in time for National Manufacturing Day on Friday.
Wisconsin is home to more than 9,300 manufacturers that employ more than 460,000 workers, according to the report, which cites statistics from the Wisconsin Economic Development Corp., among other sources. Combined, the state’s manufacturing sector produced north of $56 billion worth of output in 2016, accounting for 18 percent of the state’s gross domestic product.
The report also notes:
● Manufactured goods account for 86 percent of all Wisconsin exports, demonstrating a healthy worldwide demand for products and technologies originating in the state
● The annual wage for manufacturing employees is $58,046
● There is an 88% greater employment concentration in manufacturing than the national average, which makes Wisconsin the 2nd largest manufacturing concentration in the nation.
“Wisconsin’s outstanding manufacturing industry not only provides excellent jobs for hard-working families, it tells companies that Wisconsin is open for business,” said Rob McDonald, chairman of the board for the Institute for Reforming Government, a 501 (c)(3) limited government organization.
IRG’s report notes that Wisconsin has been on a roll thanks to the pro-growth policies of former Gov. Scott Walker and the Republican-led Legislature. It cites regulatory relief under Walker and the successful manufacturing and agriculture tax credit that has spurred the creation of tens of thousands of jobs, according to a University of Wisconsin analysis. Walker serves as national honorary chair for the institute.
“These are the kinds of forward -thinking policies other states can learn from to boost industries in their own states,” McDonald said.
“Policies do matter and on this you had a governor, starting out very prominently in August of last year, who was running on a platform to repeal the manufacturing and ag tax credit, which we believe has been a game changer for manufacturing in this state,” said Kurt Bauer, president and CEO of Wisconsin Manufacturers and Commerce, the state’s largest business advocacy group.
As Empower Wisconsin reported last month, the Badger State has seen its employment base decline by 10,500 jobs since the first of the year, when Evers took office. And the jobless rate has edged up to 3.1 percent, still historically low but up from record low 2.8 percent unemployment earlier this year.
U.S. manufacturing activity dropped to a 10-year low, according to the latest Institute for Supply Management index. Trade worries and global pressures weighed heavily.
Bauer said federal trade and tariffs issues are definitely having an impact, but he added that WMC members remain “fairly supportive” of President Trump’s handling of China.
“They understand as exporters to China, that China has not reciprocated,” Bauer said. The U.S. trade deficit with China topped $34.83 billion in August, a significant uptick from the same month a year ago. “About 70 percent of my members say the tariffs on China are proper and necessary to correct the imbalance.”
Bauer said the politics of impeachment and the constant chatter about a looming recession aren’t helping buoy the confidence of American business.
“It certainly creates a lot of uncertainty, and businesses hate uncertainty,” he said. “That’s the world they operate in already. The government shouldn’t make it worse … If there is an uncertain environment, you tend to hold off on investments, including hiring.”