The real story about those job numbers

By Tom Hefty

Wisconsin news media are focused on the “sluggish” statewide, private-sector job growth numbers that are a little more than half the national rate — 1.2% here in 2013 versus 2.1% for the nation as a whole.

Reporters and commentators are pointing out that the Badger State, according to the latest figures from the U.S. Bureau of Labor Statistics, gained 28,141 private-sector jobs last year and had a growth rate that was 37th among the 50 states. (To see the report, go to http://www.bls.gov/news.release/cewqtr.nr0.htm.

True enough.

But the more interesting story and statistics lie elsewhere.

Wisconsin, we now know, ranked 12th highest in the country in average wage increases in 2013. Our wage increase was 1.2% while the national average wage increase was zero.

Rising wages are obviously good news for Wisconsin families. The Wisconsin unemployment rate is 5.7%, lower than the national average of 6.3%. At 68%, the Wisconsin work force participation rate — the percentage of Wisconsin citizens in the work force — is higher than the national average of 62.8%.

So, to sum up: Wages are rising. The unemployment rate is low. And a high percentage of Wisconsin residents have jobs. But still we have sluggish job growth.

That dichotomy — low job growth but high wage growth — was particularly apparent in Dane County. Job growth in Dane County was 200th out of 335 counties. But Dane County ranked near the top in average wage increases — ninth highest in the country.


Dane County is worth noting for another reason as well. The numbers for wage growth would appear to refute those who blame Act 10 for Wisconsin’s economic performance. If Act 10 did indeed have a negative impact, it would logically appear most sharply in Dane County, the area with the greatest percentage of government jobs. Instead, Dane County wage growth has been extraordinarily high.


That’s good news, but that story conflicts with the Democrats’ campaign narrative.


Ninety miles to the east, meanwhile, there is yet another story — and a much more dismal one. Milwaukee County’s job growth last year was 0.5%, or 249th among 335 counties. Wages grew in Wisconsin. Average wages declined in Milwaukee by 0.2%.


Wisconsin as a whole, in other words, had a job growth rate half the national average, and Milwaukee had a job growth rate half the state average. As noted, wages in Wisconsin as a whole grew faster than the national average. In Milwaukee, they declined.


The end of 2013 marked another important milestone in Wisconsin economics. For the first time in history, the average wages in Dane County exceeded the average wages in Milwaukee County. The average weekly wage in Dane County was $1,003, compared with Milwaukee’s $963. Madison, the government center of Wisconsin, now has higher average wages than Milwaukee, the private-sector commercial center of the state.


Contrary to popular belief, state and local government jobs are growing, not shrinking. According to the Bureau of Labor Statistics, the Dane County wage growth comes from both the private sector (the high-paying medical software giant Epic in the “professional and business services” category) and the government sector, which also pays above the statewide average.


The top line state job growth number is important. Wisconsin is growing steadily, but not as fast as Gov. Scott Walker’s goal, as the daily headlines remind us. The important numbers are in the statistics behind the headlines.

Tom Hefty is the retired CEO of Blue Cross-Blue Shield of Wisconsin and a close observer of economic data detailing Wisconsin’s position.
 

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