MILWAUKEE – At this month’s meeting of the Wisconsin Innovation Network in Milwaukee, guest speaker Todd Berry of the Wisconsin Taxpayers Alliance was asked what single thing was standing between the city and producing per capita incomes that matched the state average.
Berry, whose organization has been charting the state’s taxation and government spending trends for 75 years, didn’t give a predictable answer about high taxes. Instead, the WTA president boiled it down to one word: Education. Milwaukee needs to make sure its children graduate from high school and obtain some kind of post-secondary degree, Berry said.
Now comes Ed Zore, chief executive of Northwestern Mutual Life Insurance – a company that has been rooted in Milwaukee for 150 years – with a similar wake-up call. In remarks last week to the Milwaukee 7 regional economic development group, Zore said the city’s largest private employer would bypass Milwaukee today if it were choosing to relocate from elsewhere.
“We wouldn’t be here” if the company had hired a consultant to examine U.S. regions in which to relocate. Milwaukee would “at best” fall somewhere in the middle of such as relocation survey, Zore said.
Like Berry, he didn’t dwell on taxes. “Taxes for us are not bad,” Zore told the Milwaukee Journal-Sentinel. Instead, he suggested one major reason why Milwaukee would slip off the radar screen of corporate head-hunters is the lack of an educated workforce. “We have a low percentage of college graduates, and we need to fix that,” Zore said.
Milwaukee also needs to fix its abysmal high-school graduation rate. It’s been estimated by the Milwaukee 7 group that 195,000 adults in the region don’t hold a high-school degree. It’s hard to get a post-secondary education when the secondary foundation isn’t there.
While Berry and Zore have spoken up recently, it’s hardly news that cities with unskilled workforces have trouble competing in the 21st century. Researchers and authors such as Richard Florida have pounded on that theme for years, although Florida gives it a cultural spin; “cool” cities are also educated cities.
Others, such as author and professor Joel Kotkin, say the “cool” doesn’t come first – the educated workforce and skilled labor pool takes precedent. There’s more literature supporting his point of view, including a three-year-old report by Edward Glaeser of Harvard University and the Albert Saiz of the Wharton School. They stressed that “human capital” is a driving force in the development of cities.
“For more than a century, educated cities have grown more rapidly than comparable cities with less human capital. This fact survives a battery of other control variables, metropolitan-area fixed effects and tests for reverse causality,” they wrote. “We also find that skilled cities are growing because they are becoming more economically productive (relative to less skilled cities) not because those cities are becoming more attractive places to live.”
Perhaps the most telling conclusion for Milwaukee: “Most surprisingly, we find evidence suggesting that skills-city growth connection occurs mainly in declining areas and occurs in large part because skilled cities are better at adapting to economic shocks.”
Certainly, Milwaukee has felt it share of economic shocks. The decline in the manufacturing sector hit this city as hard as any, and while its manufacturing base is retooling and making better use of technology, the dislocation was massive.
It would be easy to blame only the Milwaukee School District for losing a generation of kids, but school districts can’t do it alone. Parents must prepare their children to learn and instill in them a sense of purpose about education. And the rest of the community must be there to support the process. At a time when Milwaukee-area businesses are facing a shortage of skilled workers, it would make sense to forge more and stronger alliances between the private sector and the schools.
Demographics alone would suggest all Wisconsin businesses, whether in Milwaukee or elsewhere, will be confronting labor shortages as the “baby boom” generation begins to retire. Those businesses would be far better off if Milwaukee kept its young people in high school – perhaps with the help of school-to-work programs – and put them in the pipeline for technical college or a four-year degree.
Milwaukee doesn’t need to worry about being attractive or “cool,” because it already is. What it needs are more workers who can perform 21st century jobs.
Still is president of the Wisconsin Technology Council. He is the former associate editor of the Wisconsin State Journal in Madison.