Delore Zimmerman likes a lot of what he sees in Wisconsin’s economy: its tradition of high-performing, globally competitive companies; its above-average export growth; and what he describes as a “robust” tech-based ecosystem driven by business, university and government.
But he’s less optimistic about the ability of Wisconsin – and many other states, for that matter – to break free of two seemingly contradictory trends. The first is nagging unemployment, which stood at 7.8 percent statewide in September and higher nationally, and the gap between available jobs and workers who are qualified to fill them.
“We’ve got a serious mismatch in our country right now when it comes to our workforce,” Zimmerman told a business luncheon in Madison Tuesday, “and Wisconsin is no exception.”
Zimmerman was on hand for the Wisconsin Manufacturers & Commerce 100th anniversary luncheon to talk about “Enterprising States,” an annual report prepared for the U.S. Chamber of Commerce by Zimmerman and his North Dakota-based consulting group. He said Wisconsin scores well when it comes to most workforce education factors, but employers here are still having a hard time finding the right people for available jobs.
Kurt Bauer, WMC’s president, calls it the “workforce paradox,” a climate in which many people are still out of work but many jobs are going unfilled.
“Right now, we have a shortage of skilled labor,” Bauer said. “It’s only going to get worse.”
Here are reasons why that grim assessment may be right:
There are shortages of skilled workers in key trades: A survey released Monday by Deloitte & Touche and The Manufacturing Institute indicated that manufacturers across the United States cannot fill an estimated 600,000 jobs, mainly in skilled production areas such as machinists, craft workers and other technicians.
The survey polled 1,123 manufacturing company executives and found that 5 percent of all manufacturing jobs are unfilled due to a dearth of skilled applicants.
Education is partly to blame: One report after another has warned that America’s educational system is failing to produce enough science, technology, engineering and math graduates, and that shortage may be finally catching up to the economy. Technical colleges are trying to fill the gap, but too many graduating high-school students don’t see skilled trades and STEM jobs as a career path. Parental biases about college degrees play into that phenomenon, as well.
Industry is partly to blame, too: If you lay off people at the first whiff of an economic downturn, or in favor of adding jobs overseas, people eventually get the hint and look for other ways to support themselves and their families. Industry can also do a better job of telling young people that today’s production jobs are largely technology based, well-paid and “clean.” It’s not your father’s factory anymore.
Demographics work against Wisconsin: As Zimmerman noted in his report, Wisconsin is an aging state. That means more workers are closer to retirement, or have already retired. That makes it more important to keep young workers at home. “Wisconsin trails the nation in residents 25 to 39, a critical age group for young families and mid-level professionals,” the report noted. “With many attractive, mid-sized communities and a relatively affordable cost of living, Wisconsin could be a haven for young families, yet it trails the national average.”
Worker mobility is restricted by housing trends: If you can’t sell your house in Phoenix or Tampa, it’s a lot tougher to take a job in Milwaukee or Green Bay. “Housing handcuffs” are crimping historic migration trends.
The world has changed – but some people won’t accept it: Wisconsin must compete in national and global economies that put a premium on skilled workers who can communicate, solve problems, work as part of a team and adapt to change. Workers who don’t fit that description or decline to try will increasingly find themselves bypassed by opportunity. Similarly, policymakers who don’t grasp the realities of the innovation economy shouldn’t be surprised if their states, regions or cities slip further behind.
Endowing our future was an overriding message in Zimmerman’s “Enterprising States” report, which stressed investing in education and workforce training, infrastructure, key industries, business start-ups and scale-ups while producing a business-friendly environment.
“A state can neither cut nor tax itself into prosperity,” he said. Now, if only our divided political system can reach the same conclusion.
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