Wisconsin Employment Climbs … to 12,500 Below January 2011 Levels

The Wisconsin Department of Workforce Development today released figures for January employment revised to account for benchmark revisions. Nonfarm payroll employment and nonfarm private employment both rose. But the latter just barely exceeded levels of a year previous, while nonfarm payroll employment fell short.

Figure 1 presents the nonfarm payroll employment series, while Figure 2 presents the private nonfarm employment series. The red lines indicate the forecasts from the government’s October Wisconsin Economic Outlook.

wi_employ1.gif
Figure 1: Wisconsin nonfarm payroll employment from BLS, January release (blue), WI Department of Workforce Development, January release (green), and projections from Wisconsin Economic Outlook (red), in 000’s. NBER defined recession dates shaded gray. Vertical line at 2011M01. Sources: BLS, October Wisconsin Economic Outlook, WI DWD (3/8/12) and NBER.

wi_employ2.gif
Figure 2: Wisconsin private nonfarm payroll employment from BLS, January release (blue), WI Department of Workforce Development, January release (green), and projections from Wisconsin Economic Outlook (red), in 000’s. NBER defined recession dates shaded gray. Vertical line at 2011M01. Sources: BLS, October Wisconsin Economic Outlook, WI DWD (3/8/12) and NBER.

Apparently, the Wisconsin employment situation was less bright in December 2011 than originally reported, according to the latest available data.

As many have remarked (it hit 64 degrees fahrenheit the day before yesterday!), it has been unseasonably warm in Wisconsin this Spring. Hence, is of interest to consider what the change in the not-seasonally-adjusted employment numbers are. Surprisingly (to me), the net loss from January to January in nonfarm employment is 19,400, and the net loss in private employment is 900 7000 [h/t Jake formerly of the LP] (i.e., both n.s.a series declined y/y in January).

This article from five days ago, entitled “Wisconsin missing out on U.S. jobs gains,” (by Schmid and Gilbert, Journal Sentinel) summarizes some potential explanations for Wisconsin’s lackluster employment performance.

“The rest of the nation is moving upwards. We’re one of the few states moving downward. There’s something wrong,” said economist Steven Deller of the University of Wisconsin-Madison.

The United States as a whole has added private-sector jobs 23 months in a row, including almost a half million jobs in the past two months.

But Wisconsin has been moving in the opposite direction, a trend that not only threatens Gov. Scott Walker’s campaign promise but could cloud any message of economic renewal as the state heads into an all-but-certain recall election this summer.

An analysis of jobs data shows that Wisconsin lags the nation in a number of ways that reflect grimly on its economy:

Wisconsin has lost more private-sector jobs (an estimated 27,700) than any state in the country since the middle of last year (July through December), according to the U.S. Bureau of Labor Statistics. Only one other state, Missouri, is close, losing about 19,000 jobs in that stretch.

Although the state added more than 41,000 private-sector jobs in the first half of 2011, losses in the second half of the year have wiped out most of those gains, according to the Bureau of Labor Statistics.

Despite an uptick in December, Wisconsin has the biggest six-month decline in manufacturing jobs in the nation after California. That’s significant because Wisconsin depends more on manufacturing for jobs than any state but Indiana. It’s also significant at a time when a renaissance in manufacturing is helping drive the national recovery.

Wisconsin’s job losses can’t be readily explained as part of a broader pattern involving Midwestern or industrial states. Wisconsin’s neighbors are all outperforming the state when it comes to job growth over the past six months.

Wisconsin also lags in some broader measures and forecasts. The most recent leading indicators for each of the 50 states, compiled by the Philadelphia Federal Reserve, identify Wisconsin as one of only six states expected to contract in the first half of this year. Walker declined an interview request, but he and his administration have painted a much brighter economic picture than these numbers suggest.

“Governor Walker’s policies have helped turn Wisconsin around,” said his communications director, Chris Schrimpf.

[Emphasis added in bold — MDC]

The observation regarding manufacturing is particularly interesting. Figure 3 presents a time series plot for manufacturing employment.

wi_employ3.gif
Figure 3: Wisconsin manufacturing employment from BLS, January release (blue), WI Department of Workforce Development, January release (green), in 000’s. NBER defined recession dates shaded gray. Vertical line at 2011M01. Sources: BLS, WI DWD (3/8/12) and NBER.

As a point of comparison, manufacturing employment nationwide is rising 2% y/y through January).

Parting note: Latest readings on Wisconsin’s leading indicators (for Dec 2011) are negative, according to the Philadelphia Fed. See this post for a graph; these indices will certainly be revised in light of the January employment figures.

This post originally appeared at Econbrowser and is posted with permission.

One Response to "Wisconsin Employment Climbs … to 12,500 Below January 2011 Levels"

  1. michael Phippen   March 10, 2012 at 6:38 am

    So Menzie,
    I realize what your data says up to Nov./Dec 2011-however a more immediate measure of current employment trends is characterized in classified ads or more accurately Craigs list employment opportunities for CNC operators and Set-up technicians. If you analyze current data I think you will find a completely different story. Additionally the trend in Wisconsin is continuing!