The good news for Wisconsin’s economy: It added nearly 20,000 jobs in 2011, according to the now-official figures from the U.S. Bureau of Labor Statistics.
The not-so-good news: Wisconsin still ranked behind 40 other states when it came to creating jobs.
There are several popular and plausible explanations. The first is the political uncertainty surrounding Gov. Scott Walker’s recall election, which led some business owners and managers to adopt a “wait-and-see” stance toward expanding. The second is the fact that public employees are included in the Labor statistics, and Wisconsin experienced a wave of state and local government retirements in 2011.
There’s a third explanation, and it’s less popular – at least in some sectors – because it requires rethinking long-held views about what makes a modern economy tick. Simply put, Wisconsin is putting a lot of its economic development eggs in a few baskets.
Manufacturing and agriculture are the twin kings of the Wisconsin economy. In terms of overall workforce size and economic value, measured as a function of productivity and wages, they are vital engines. When it comes to creating net new jobs, however, the royal family portrait gets a bit larger.
Wisconsin’s manufacturing employment gains ranked among the nation’s top 10 last year and the state remains one of the top two states in per capita manufacturing (usually jockeying with Indiana for the top spot). While Wisconsin will likely continue to beat most other states in manufacturing employment growth, the national forecast for job growth by 2020 remains flat.
In fact, the Bureau of Labor Statistics predicts manufacturing employment will decline 1 percent nationally by 2020 as productivity gains, automation and international competition reduce the demand for labor in most industries. Jobs in agriculture will decline by 4 percent nationally, the labor economists predict.
So, where are the opportunities for job growth greatest? Here are some federal forecasts (2010-2020) that should be kept in mind as Wisconsin focuses on building more companies and jobs:
Health care and social assistance, up 5.7 million jobs: The healthcare and social assistance industry is projected to yield about 28 percent of all new jobs created in the U.S. economy. This industry – which includes hospitals, nursing and residential care facilities, and individual and family services – is expected to grow by 33 percent, or 5.7 million new jobs.
Professional, scientific and technical services, up 2.1 million jobs: Employment in professional, scientific, and technical services is projected to grow by 29 percent, adding about 2.1 million new jobs by 2020. Employment in computer systems design and related services is expected to increase by 47 percent, driven by growing demand for sophisticated computer network and mobile technologies. Employment in management, scientific, and technical consulting services is anticipated to expand at 58 percent.
Computer and information technology, up 758,800 jobs. These occupations are projected to grow by 22 percent by 2020. Demand for workers in these fields will be driven by the continuing need for businesses, government and other organizations to adopt and use the latest technologies. Workers in these occupations will be needed to develop software, enhance cybersecurity and update existing network infrastructure.
Software, Internet publishing and telecom, up 140,000 jobs: Employment in the information sector is projected to increase by 5 percent, adding 140,300 jobs by 2020. The sector contains software publishing, which is expected to grow by 35 percent as organizations continue to adopt the newest software products.
Architecture and engineering, up 252,800 jobs: These occupations are projected to grow by roughly 10 percent. Much of the growth in this group will be due to recovery from the recession, with 149,800 jobs having been lost from 2006 to 2010. Growth among engineering occupations, especially civil engineers, is expected to be high, with the occupation adding 51,100 positions.
Life, physical and social science, up 190,800 jobs. Employment in life, physical, and social science occupations is projected to increase by nearly 190,800 jobs from 2010 to 2020, a growth rate of 16 percent. Employment in life science occupations will increase by 58,300, driven largely by the need for medical scientists to conduct research and to create new medical technologies, treatments and pharmaceuticals.
Two other mega-sectors of particular interest to Wisconsin are business and financial operations (up 1.2 million jobs) and finance and insurance (up 505,000 jobs). While some of the projected increase is due to recovery from the recession, much is tied to expected growth in sectors where Wisconsin has a historic leg up.
Wisconsin has identifiable strengths in each of those growth sectors. If the state wants job growth to exceed the U.S. average in coming years, state policymakers should pay at least as much attention to those sectors that are expected to grow as they do those that aren’t.
Still is president of the Wisconsin Technology Council and the Wisconsin Innovation Network. He can be reached at tstill@wisconsintechnologycouncil.com
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