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Wisconsin ranked second in the
nation for manufacturing job growth in 2016 and 2017, according to
recent data highlighted by groups celebrating the state’s
“Manufacturing Month” throughout October.
“Wisconsin’s outstanding manufacturing industry not only provides
excellent jobs for hard-working families, it tells companies that
Wisconsin is open for business,” Rob McDonald, chairman of the board
at the Institute for Reforming Government (IRG), said. “Creating an
environment that would attract economic growth was a priority for
[former] Governor [Scott] Walker and the Legislature and other
states need to look no further than the results — thousands of jobs
and increased business growth. These are the kinds of
forward-thinking policies other states can learn from to boost
industries in their own states.”
According to recent data published by the Wisconsin Economic
Development Corporation (WEDC), Wisconsin’s 9,437 manufacturers
employed more than 460,000 workers, or roughly 16 percent of the
state’s total employees.
Wisconsin manufacturers produced more than $56 billion worth of
output in 2016, accounting for 18 percent of the state’s GDP.
There is an “88 percent greater employment concentration in
manufacturing than the national average,” which makes Wisconsin the
“2nd largest manufacturing concentration” in the nation, according
to a new policy paper published by IRG.
Additionally, “manufactured goods account for 86 percent of all Wisconsin
exports, demonstrating a healthy worldwide demand for products and
technologies originating in the state,” WEDC states.
Wisconsin’s manufacturing boom, IRG argues, was a result of several
policies implemented since 2011, including the Manufacturing and
Agriculture Credit (MAG), the Fabrication Laboratories (Fab Lab)
Grant Program, and the Research Tax Credit.
The MAG “had a significant impact on manufacturing and total
employment in the state,” a 2017 Center for Research on the
Wisconsin Economy report found.
“Since 2013, manufacturing employment has grown on average 1.9
percentage points (at an annual rate) faster in Wisconsin relative
to counties just across the border,” the study found. It also said
the tax credit resulted in “significant spillovers to the broader
economy.”
By September 2016, “the cumulative impact of manufacturing
employment in Wisconsin border counties was 6.6 percent higher and
total employment 2.5 percent higher than they would have been in the
absence of the tax credit,” the report adds.
Since its introduction, MAG accounted for a total gain of “over
20,000 manufacturing jobs (a 4.6 percent increase) and over 42,000
total jobs (a 1.8 percent increase) in Wisconsin,” the report
states.
Fab Lab grants were initially funded with $500,000 from the 2015-17
budget, and again in 2017, 2018, and 2019 with the same amount “to
establish or expand local fabrication laboratory (Fab Lab)
facilities.”
The program is just one effort the state has pursued “in order to
prepare students for careers in the manufacturing industry,” IRG
notes.
According to WEDC, “Wisconsin’s education programs and support have
helped fuel our workforce talent” and there are “100+ UW
manufacturing programs that achieved Center of Excellence status.”
While research tax credits have been available to businesses for
several decades, the Wisconsin Chamber of Commerce and the Wisconsin
Manufacturers & Commerce (WMC) say they should be revitalized to
make Wisconsin more competitive. Allowing currently unusable credits
to become refundable would help put Wisconsin on par with some of
its competitors.
“When companies decide where to invest in this expensive technology
and skilled employees, they look at the total cost of the investment
including incentives,” WMC explains, which points out that 36 states
have such credits. Among them, 12 either have refundable R& D
credits or allow excess nonrefundable credits to offset another tax
liability.
“To capture and maintain large research investments, Wisconsin
should join the ranks of those states that offer a benefit above and
beyond what most states do,” WMC argues. |
