• WisBusiness

Monday, April 20, 2009

A wake-up call from Louisiana

By James A. Buchen
The recent announcement that Thomas Industries plans to move nearly 300 manufacturing jobs to Louisiana and expand in that state is further evidence that Wisconsin's manufacturing economy is in crisis. Global and regional competition is increasingly heated as political leaders across the United States and around the world develop initiatives to attract and retain jobs for their citizens

Wisconsindoes not have a competitive business climate to begin with, and is lagging in developing initiatives to attract and retain jobs for its workers. In fact, policies pending today at the Capitol will make it harder for manufacturers to grow and create jobs -- billions in higher taxes, expanded liability, increased insurance premiums, mandated wage increases, and increased litigation regarding workplace complaints.

There's an odd disconnect between the 9.4 percent unemployment rate and the hemorrhaging manufacturing sector, and the governor's proposals to increase taxes, regulation and litigation for employers.

The numbers tell the story. Since the year 2000, when manufacturing reached an all time high of employment, Wisconsin has lost more than 140,000 manufacturing jobs. It has become increasingly difficult to replace high-wage manufacturing at the end of recessions. Click on the link to see the decline in manufacturing employment in our state since 1998: Wisconsin Manufacturing Employment Chart.

Earlier this week, Gardner Denver Inc., of Quincy, Ill., which operates Thomas Industries in Sheboygan, announced the relocation of the jobs to Monroe, La. The manufacturing jobs at the Sheboygan operation will be incorporated into the 76-employee facility in Monroe.

Thomas Industries currently employs 366 people in Sheboygan, of which approximately 280 are in manufacturing and related support roles. The other 86 employees are in sales, marketing, engineering, administrative and financial positions. The 280 manufacturing and related support positions are being relocated to Louisiana. The other 86 positions will remain in Sheboygan.

The Wisconsin manufacturing sector decline started well before the current recession. However, it has accelerated to the point where we currently have the lowest number of people employed in manufacturing since the government started keeping records. We are not just losing jobs due to the recession, but also because manufacturers find that they can be more competitive if they move jobs to other states.

In March, the manufacturing job loss led the all sectors with 9,000 jobs lost as Wisconsin's total unemployment rate hit 9.4 percent, the highest in a generation.

Ironically, one of the few sectors not to lose jobs in the last year was the public sector.

High-end manufacturing has historically been the backbone of the Wisconsin economy, providing the highest wages and best benefits of any economic sector. For many years Wisconsin has had the second most manufacturing intensive economy among the 50 states, ranking with Indiana and California.

Our high-end industrial economy provided jobs for manufacturing workers, and sustained a vibrant service sector. When manufacturing in our state is strong, it ensures we have a solid tax base to fund our schools, our roads and other government services.

Hopefully, this latest announcement will serve as a wake up call for policy makers that we need a dramatic change in our state's direction. The governor's proposal to increase the tax burden on Wisconsin businesses and investors by more than $1 billion is not going to help attract and retain jobs.

Fortunately, the state Legislature still has the opportunity to rethink state budget provisions and other pending legislation that will raise business taxes, increase business regulations, and encourage more litigation that targets both business and consumers.

WMC members agree that policies currently under consideration by the state Legislature will only serve to accelerate the pace of manufacturing job losses in Wisconsin. Wisconsin must begin to develop and implement a comprehensive strategy that will grow our economy and create high wage jobs in our communities.

In an effort to assist policy makers, Wisconsin's business community, in collaboration with a wide range of stake holders, has developed a package of policy initiatives entitled Moving Wisconsin Forward that can serve as a starting point for this important effort.

Everyone has a stake in improving the business climate and creating jobs in Wisconsin. That is why we all need to talk to our elected officials and encourage them to rethink the budget proposals that will most surely cost us jobs. We need to focus their efforts on growing the economy for our families, our communities and Wisconsin's future.

-- Buchen is vice president of government relations for WMC, which represents 4,000 businesses in Wisconsin. WMC is dedicated to making Wisconsin the most competitive state in the nation.


Comments: 7

At October 2, 2017 at 4:16 AM, Blogger Barbara said...

Frankly, I don't think that plant will be built, and a lot of politicians will have egg on their faces. If it is built, it will be staffed mostly by immigrants with special visas because of the need for their skills, or at least it will be staffed with people who do not currently live in that state. The source of the workers is a big question. Moreover,I write my essay today statement this way: one has to wonder where these thousands of people will live. You cannot staff a new plant on Day One and expect your entire governors has no clue about what is really going on with the available workforce.

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