My Forecast For 2016
The start of a new year is a time that many of us stop to take stock of life, to look back on the year that was and ahead to the year to come. Perhaps that's why the Wisconsin Bankers Association holds its annual Economic Forecast lunch every January, to talk about what we can expect from the Wisconsin and American economies in the year ahead. Of course, this week's news about the Shanghai stock market is a good reminder that we always take forecasts with a grain of salt--there's no perfect predictor machine that tells us exactly where things will go. But all the same, I'm bullish on Wisconsin, and here's why.
In the last five years we've made huge progress on two key economic factors: our business climate and our skills gap. Think about all the changes we've seen in the last five years and for our state's new "Open for Business" attitude: a totally different regulatory attitude at agencies like the DNR; national-award-winning tort reform that restores common sense to our legal system; deficits to surpluses in the state budget, and no unfunded pension liability; and let's not forget--over $2 billion on tax relief for families and job creators. Talk about a total 180 from just a few short years ago! And the proof is in the pudding: every week I'm out across Wisconsin --frequently to celebrate another business moved here from Illinois, or another factory or facility expanding jobs or square footage. It's pretty exciting stuff.
And we're tackling our skills gap, that pesky space between the workers we have and the skills our employers demand. You've heard me speak many times about our Wisconsin Fast Forward program, which is investing tens of millions of dollars in worker training through tech colleges, unions, apprenticeships, and employers. We expanded capacity in high-need fields through the Blueprint for Prosperity grants to tech colleges, targeting individual regions based on employer demand. And you know I'm excited about the growing number of Fab Labs in Wisconsin, introducing our students to the miracles of 3-D printing and fabrication.
With low unemployment (just 4.2 percent) but continued job creation, we now face new, good challenges as a state. For every job we create -- we also need a worker to fill that job. If every job on JobCenterofWisconsin.com was taken tomorrow by someone coming off unemployment with the skills and geographic proximity necessary, we'd still have 10,000+ open jobs. I think we need to adopt a two-prong approach to solving our coming worker shortage. First, we need more out-of-state workers to choose Wisconsin. Internships that lead to job offers are one great tool to keep students from other states who come to Wisconsin's great colleges and universities. Another is the Talent Upload program at the Fox Cities Chamber and the MKE Fellows in Milwaukee, both of which I described last week. Within Wisconsin, we need to get more of our people off the bench and into the work game by boosting our labor market participation rate. Right now, 67.8 percent of working age Wisconsinites are actually in the labor force, which is good compared to the rest of the country, but it still means we've got a lot of talent sitting on the sidelines. I'm encouraged by programs like our Department of Corrections' technical college partnerships which will get working-age Wisconsinites coming out of institutions moved right into the workforce.
To my mind, out other next big step is encouraging entrepreneurship and small business. Wisconsin has a low entrepreneur/start-up rate but a high small business survival rate. These statistics reflect our common cultural heritage: we don't take many risks, which means the bets we do take are good ones that often pay off. That's fine as far as it goes, but we need to boost our start-up rate when we know that 60 percent plus of new jobs come from small business growth. WEDC is doing good work to support revolving loan funds at minority chambers, for instance, and seed accelerators. I'm also excited about Wisconsin's crowdfunding law as a private-sector solution to expand small business lending, especially in our food and beverage cluster.
Like I said at the start, we've made tremendous strides these past five years. The new problems we have are good problems to have--they are the challenges that come with a growing economy. I'm confident that the policies we're pursuing will continue to create the climate for prosperity in the year to come.
The magic of molten metal
On Wednesday, I joined Senator Duey Strobel and Rep. Rob Brooks to tour Charter Steel in Saukville. I love visiting foundries--they take scrap metal, melt it at incredible temperatures, and pour the molten metal into shapes that become car bodies, building rods, and industrial coils. You'll have to trust me--it's incredible what they do. While there we had a good conversation about the issues they face, including the price of energy (it takes a lot of electricity to generate the heat necessary to actually melt metal).
From there, we went to the i4Learning Charter School with Rep. Jesse Kremers. This school in Campbellsport is helping students become self-directed life-long learners with a unique model inspired by a TED Talk!
Housing with hope
This afternoon I'm at North Point Community Apartments in Madison. Rev. Carmen Porco has an innovative housing model that's showing real results in giving families a better future. His apartment communities after-school programs and other wrap-around services help families break the cycle of poverty. This winter we're all especially aware of those who struggle with homelessness, especially in our urban areas. As we confront the twin problems of homelessness and affordable housing, we're seeing more evidence that the best models combine stable housing with supportive services. Together, a safe, stable place to live and a community of care get people back on their feet and headed in the direction of a job and self-sufficiency.