Thursday, May 24, 2018

Minnesota passes Wisconsin for jobs. No righties, this isn't working

For some reason, I had missed that the Quarterly Census of Employment and Wages (aka, the more thorough, “gold standard” job report) started pre-releasing their overall figures a couple of weeks ahead of their main report, beginning with their year-end 2017 totals this week.

Which explains why the following headline from Wisconsin Public Radio snuck up on me, and I didn’t see it until this morning. “Minnesota passes Wisconsin in total jobs, U.S. Bureau of Labor Statistics reports.”
University of Michigan Labor Economist Donald Grimes said what stuck out to him was that Minnesota had added more jobs than Wisconsin every year since 2010.

"The fact that it's every year is somewhat remarkable," Grimes said.

The numbers show that in 2017, Wisconsin added a total of 28,696 jobs. That translated to a growth rate of about 1 percent, which ranked 27th in the nation.

Minnesota, by contrast, added 35,925 jobs in 2017 for a growth rate of 1.3 percent, which ranked 18th.
What’s sad is that Wisconsin’s 27th place standing in rate of job growth is an improvement over the rankings in the 30s that have been the rule during Scott Walker’s Reign of Error. But it’s not anything to be proud of, not only because it makes for 26 straight quarters of job growth in the bottom half of the US, but also because 2017 continued a trend of lower job growth in Wisconsin that started in early 2016.

The most amazing part about that chart to me is that the fastest rate of job growth was reached in March 2011 – the month that Act 10 was jammed through the Legislature and signed by the Governor.

There isn’t a breakdown into various sectors of jobs, like public sector vs private sector or manufacturing (that’ll come in a couple of weeks), but we can certainly evaluate the change in total jobs between the two states. And Minnesota has lapped Wisconsin in that stat since Walker and Dayton took office.

Total job growth, Dec 2010-Dec 2017
Minn +292,976 (+11.34%)
Wis. +202,554 (+7.59%)

In addition to the gap of more than 90,000 jobs, this stat means that Minnesota has a rate of job growth that’s more than 50% faster than Wisconsin over these 7 years.

The “gold standard” report also showed that Wisconsin didn’t gain as many jobs as the Wisconsin Department of Workforce Development claimed it did when it originally reported their December 2017 figures back in January.
Based on preliminary data, Wisconsin added a significant 40,200 total non-farm jobs and 43,500 private sector jobs from December 2016 to December 2017, including a significant 11,500 manufacturing jobs. The state also gained 1,300 private sector jobs from November 2017 to December 2017, including 1,200 construction jobs. November private sector jobs gains were also revised up by 2,100, showing that Wisconsin gained a total of 4,900 private sector jobs from October 2017 to November 2017.
That’s a whole lot more than the nearly 28,700 jobs that the QCEW report is saying for 2017, and it continues a disturbing trend of Scott Walker’s Department of Workforce Development overestimating job and labor force growth in recent years.

The last thing that grabbed my attention was the job growth in the 6 largest Wisconsin counties, which was in this report. Milwaukee County had its best growth in 2017 out of any year in the 2010s (+4,233), but that’s damning with faint praise, as Milwaukee County’s 2017 growth rate of 0.9% was still well below the US rate of 1.5%, and came on the heels of losing nearly 1,500 jobs in 2016.

Over the last 7 years, Milwaukee County added jobs at less than half the rate of the rest of the state, which helps explain the Milwaukee metro’s lack of growth in income in recent years (as I mentioned last week). By comparison, those crazy hippies in Dane County have set the pace with Minnesota-like job growth in the Age of Fitzwalkerstan.

Job growth, largest Wis counties, Dec 2010-Dec 2017
Dane County +11.73%
Waukesha Co. +9.75%
Brown County +8.44%
Wisconsin state +7.59%
Outagamie Co. +7.15%
Winnebago Co. +5.10%
Milwaukee Co. +3.73%

By comparison, the 13.54% job growth in Hennepin County, Minnesota (where Minneapolis is located) even outpaces the boom going on in Madison, and the Twin Cities exurb of Washington County is even faster- at 16.41%. As the labor economist notes in WPR’s article, Wisconsin’s largest metro area is underperforming Minnesota’s largest one, and maybe it’s time to learn something from it.
"You need to focus on why Milwaukee is doing so much worse than Minneapolis-St. Paul and how you can be more like Minneapolis-St. Paul," Grimes said.
Might it have something to do with a State Legislature in Minnesota that doesn’t try to handcuff the state’s largest metro area and economic engine, and actually invests in 21st Century transit and quality of life instead of beating up on the Cities in the name of “divide and conquer” politics that stir up the rubes? Naaahh, that’s just crazy talk.

One other suggestion- maybe Wisconsin’s big cities could try to pay the big-league wages that are given to workers in the Twin Cities and the Chicago area.

Average weekly wage, December 2017
Hennepin Co., MN $1,335 (+3.0% vs Dec 2016)
Ramsey Co., (St. Paul) MN $1,202 (+3.8%)

Lake County, IL $1,411 (+1.0%)
Cook County, IL $1,283 (+2.6%)

Waukesha Co. $1,082 (+0.8%)
Dane County, Wis $1,070 (+3.5%)
Milwaukee Co. $1,056 (+1.5%)

Walker and his media flacks may try to spin these numbers away, but there’s no way you can ignore that Minnesota chose a very different path than we did, and we have fallen behind as a result. I’ll repeat a common theme of mine – you would never accept 7 years of the Packers being a 6-10, 7-9 team that always finished behind the Vikings, so why would we accept it in something more important like economic performance?

Not that we shouldn’t have figured it out before, but those numbers give even stronger proof that it’s time for a change in leadership Wisconsin.

Wednesday, May 23, 2018

WIsconsin Policy Forum notes explosion in wheel taxes under Walker

Jason Stein recently left the Milwaukee Journal-Sentinel to join the Wisconsin Policy Forum - a newly-merged organization consisting of the organizations that used to be known as the Wisconsin Taxpayers Alliance and the Public Policy Forum. Yesterday, Stein and the rest of the Policy Forum produced a brief on the increasing use of wheel taxes throughout the state, and it received quite a bit of media attention.

The policy brief notes that only 4 Wisconsin communities had wheel taxes in 2011 (when Scott Walker and the Wisconsin GOP came to power), but by the end of 2017, that number was up to 27, with local wheel tax revenues rising from $7.1 million to $20.7 million in that time.

Stein says one of the culprits is that state aids have failed to keep up with the costs for local communities to fix their roads. state funding for the two aids programs rose 15.5% from 2007-17, from $412.0 million to $475.7 million... When adjusted for inflation using the Consumer Price Index (CPI), however, spending for the two programs declined 2.3%, or $11.3 million in real dollars... (A recent legislative audit noted that, in general, state highway costs have tended to rise more rapidly than the CPI.)
What's not mentioned is that all of that funding increase was under Jim Doyle between 2007 and 2011. Since Walker took over, those local aids were $5.3 million lower in 2017 vs 2011, and $46.5 million less when adjusted for inflation (-9.25%).

The Policy Forum notes that one of the reasons for those cuts was because there were limited dollars to go around in the Transportation Fund, as the Walker Administration and WisGOP Legislature have refused to raise state gas taxes or most registration fees over their time in office. In addition, Stein adds that other state-imposed tax restrictions on local governments have meant that road spending often have had to take a back seat to public safety concerns.
Meanwhile, local governments in Wisconsin have few local revenue options other than the property tax, which has been tightly restricted since 2011. Though local governments are allowed to raise property tax levies only for new construction, there are exemptions for debt service and a few other circumstances.

One of the consequences of the tighter revenues appears to be less spending on local streets and roads. When we surveyed officials from nearly 500 cities and villages for our League of Wisconsin Municipalities report, The State of Wisconsin Cities and Villages 2017, many said they had shifted their spending priorities away from street maintenance to police and fire services since the start of the 2007-09 recession.
That led to a lot more of this across the state.

So local officials had few other options but to impose the wheel tax to fill in those needs. Stein ends the policy brief by noting that these wheel taxes may become even more common in future years, given the lack of revenue options that local governments have, along with the lack of money that they are getting from the state.
As wheel taxes become more common, policymakers may want to consider whether they are the ideal tax source to support local roads. It may be argued that by taxing vehicle owners, the wheel tax links the costs of local roads to users. Conversely, some might argue that road users also include commuters and visitors and a consumption tax (such as a sales tax) might be more appropriate. Such a debate cannot occur because state law does not permit municipalities to levy sales taxes, and most counties already have implemented the optional 0.5% sales tax.

As more local governments consider the wheel tax, some state officials have already suggested additional limits on it may be needed. In the meantime, however, its use may grow as long as local revenues are limited and demand for local road maintenance and improvements expands.
Note that Stein mentions that a local sales tax may be a way to make those who use the roads be more likely to pay towards those roads. What's interesting is that a few Wisconsin communities do get the chance to levy their own sales tax to pay for the extra services that come from tourism, in the form of a premier resort tax. This enables some communities to get around the tight revenue limits by using the proceeds of that sales tax to use for roads, police and other services that they otherwise would not have the tax base to support.

It seems timely to mention this as Memorial Day weekend and its related tourism looms, as the list of places with this premier resort tax are some of the first places you'd think of when it comes to "Wisconsin tourist towns."
The Village of Sister Bay: 0.5% (effective July 1, 2018)
The City of Rhinelander: 0.5%
The Village of Stockholm: 0.5%
The City of Eagle River: 0.5%
The City of Bayfield: 0.5%
The City of Wisconsin Dells: 1.25%
The Village of Lake Delton: 1.25%
My question is- why do only the small towns get the ability to raise taxes on tourists? If we're not going to give significant increases in state aids to make up for the cuts that have happened in the Age of Fitzwalkerstan, and we're not keen on seeing more potholes and more wheel taxes, then why don't we give local communities the freedom to impose their own sales taxes to make up the difference?

For example, Milwaukee County attracts the largest amount of tourism dollars in the state, with nearly $2 billion in direct spending last year. Wouldn't it be nice if they could use a part of that spending and not have to put in a $30 wheel tax on its residents (with another $20 paid by people who live in the City of Milwaukee)?

Maybe the voters of this state will be smart enough to elect a new governor that has a better plan than the deterioration we've seen during the Age of Fitzwalkerstan. But no matter the outcome in November's elections, something different needs to be done, because as Jason Stein's report for the Wisconsin Policy Forum reiterated, the current method of funding local roads isn't cutting it.

Tuesday, May 22, 2018

A date with some Queens

Sometimes more important event take precedence over a daily rant. Tonight, we have one of those events.

With the temperature nearing 80 starting tomorrow, it's time to start thinking about Summer. And about feeling good.

And about nicotine, Valium, Vicodin, marijuana, Esctasy and alcohol.....

Monday, May 21, 2018

Sure, Wisconsin incomes have risen in the 2010s. We're still losing

Here's an example of something that sounds pretty good, especially if you don't have any context.

Wow, a 16% increase in income! Things must really be thriving in Wisconsin!

Not really, and not just because Walker was using nominal and not inflation-adjusted dollars. A report that came out a few days after Governor Walker released this piece of cherry-picking showed how that increase in income for Wisconsin isn't really anything to brag about.

Let me direct you to the Bureau of Economic Analysis' report for state and metro incomes. This report now goes through the end of 2016, and what’s interesting about this report compared to the state personal income reports that were released earlier this month is that it adjusts for the cost of living in certain areas of the country, using a statistic called Regional Price Parities (RPPs).
The RPPs are calculated using price quotes for a wide array of items from the CPI, which are aggregated into broader expenditure categories (such as food, transportation or education).

Data on rents are obtained separately from the Census Bureau’s American Community Survey (ACS). The expenditure weights for each category are constructed using CPI expenditure weights, BEA’s personal consumption expenditures, and ACS rents expenditures. The broader categories and the data on rents are combined with the expenditure weights using a multilateral aggregation method that expresses a region’s price level relative to the U.S.

For example, if the RPP for area A is 120 and for area B is 90, then on average, prices are 20 percent higher and 10 percent lower than the U.S. average for A and B, respectively. If the personal income for area A is $12,000 and for area B is $9,000, then RPP-adjusted incomes are $10,000 (or $12,000/1.20) and $10,000 (or $9,000/0.90), respectively. In other words, the purchasing power of the two incomes is equivalent when adjusted by their respective RPPs.
That adjustement helps Wisconsin in these rankings, as Wisconsin’s RPP of 92.8 means that incomes in our state goes further in this survey than it does for the US as a whole. And our low population growth moves us up compared to many other parts of the country when it comes to figuring out income growth per capita, even if low population growth is a limiting item when it comes to job growth or other economic measures of well-being.

Wisconsin performed fairly well by this standard in 2016, having their inflation-adjusted incomes rise by 1.3% vs 1.1% for the US as a whole. But we badly lagged the country in the 4 years before, which correspond to when Scott Walker and the Wisconsin GOP came to power in 2011, Wisconsin ranks a subpar 5th in the Midwest for both real income growth, and real income growth per capita in that time. We also trail the figures for the US in general.

So yet again, THANKS OBAMA for helping us along.

Worse is what things look like at the local level, especially in Wisconsin’s largest metro area of Milwaukee. Between 2011 and 2016, real per capita income in the Milwaukee metro area barely grew at a rate of 1% a year, far behind other Midwestern metropolitan areas, and the US as a whole.

By comparison, Madison and the Twin Cities had incomes grow nearly twice as fast as Milwaukee (even with both metros increasing their populations at a faster rate), and the “declining” Chicago metro area had per-capita income growth nearly 3 times as fast as Milwaukee – even after taking into account the higher costs to live in Chitown.

The disparity in income growth means that both Madison and the Twin Cities has zoomed past the Milwaukee metro area for income per person during the Age of Fitzwalkerstan, and Chicago has nearly caught the Brew Town area as well. And if you’re wondering about the cities in the rest of Wisconsin, they pay even less than Madison and Milwaukee. While most grew during the Obama Recovery/Age of Fitzwalkerstan, the gap in per-capita income for all mid-size Wisconsin metros (other than Sheboygan!) is still between $2,200-$9,700 from the big 2 of Milwaukee and Madison.

The last item to note in this report is that much like the rest of rural America, the non-metro Wisconsin lagged when it came to income growth compared to what was going on in the bigger cities. To begin with, incomes were already less in rural Wisconsin in 2011, even with the lower cost of living. But the gap widened from $3,000 in 2011 to $3,700 by 2016.

One positive note is that while rural Wisconsin had income growth below the state average and the US as a whole, they did outpace the “forgotten people” in other parts of rural America, particularly in 2015 and 2016.

But the only type of person that would promote these income figures as proof that Walker’s and WisGOP’s policies are making Wisconsin prosperous would be someone who thinks the average citizen is too stupid and sheltered to recognize that most of the Midwest and the nation were rebounding better than we were. That goes double for the pro-Walker oligarchs at the Metropolitan Milwaukee Association of Commerce (MMAC), who continue to give big money for a corporatist agenda that is leaving Milwaukee in the dust for both incomes and for job growth.

As usual, the only saving grace for these income figures is the growth that continues in Madison, where education and wage levels are higher, and there is a quality of life that encourages more talent to come there. You’d think we’d try to emulate that successful liberal town, and kick the right-wingers out that have been holding back the rest of the state.

Sunday, May 20, 2018

Sure, Walker's $100-a-child giveaway is cynical + bad economics. But take the money, folks

I caught this "news" story from over the weekend by Wisconsin State Journal columnist Chris Rickert titled "'Dirty' money? Madisonians grapple with GOP's pre-election tax rebate." The premise of the article is whether "those people in liberal Madison" are going to sign up for the $100-per-child pre-election bribe from Gov Walker and the Wisconsin GOP passed into law earlier this year.
Madison mother Alisha Steele, 43, says her family will probably apply for the tax rebate Gov. Scott Walker and the Republican Legislature agreed to dole out in the months leading up to what is expected to be a difficult election for him and other Republicans this November.

But “I have really mixed feelings about it because, sure I’ll probably apply to get $200 for my two kids, but it feels” — and here she pauses — “dirty.”

On the first day parents of children under 18 years old could apply for the credit, some in a part of the state known for its liberalism in general and antipathy toward Walker in particular expressed similar reservations, while acknowledging that a hundred bucks — or 200 or 300 or 400 — is still real money.

“My husband’s perspective was, like, he rolled his eyes about it,” said mother-of-three Katie Crokus, 39, of Verona. “He’s like, we’ll take it. ... But isn’t that money better spent? I mean it’s $300 — we could probably apply it to myriad of other things that would be more valuable to the state.”
And Ms. Crokus's perspective is correct. Are there many better uses for the $130 million or so that this one-time $100-a-child giveaway will cost? Absolutely. For example, you could fill in all of the cuts to state highways that are resulting from the Walker Administration's decision to funnel $134 million to upgrade numerous roads the Foxconn-sin region. We also could use that $130 million to speed up the long-slowed I-90 project from the Illinois state line to Madison - I just drove this highway and 2 rough lanes are not acceptable to deal with for the next 3 years.

But you didn't want to spend the money to get this done

$130 million could have also been used to:

1. Restore the funding cuts given to the UW System in 2015, allowing for tuition to be frozen and for the UW to continue to offer competitive salaries.

2. Giving permanent funding increases to poorer K-12 school districts instead of continuing to leave them behind and continually be stuck between raising taxes through referendum or closing schools cut staff 8 years after Act 10 was supposed to solve these fiscal issues.

3. Banking the money to make sure we actually do have money left in the bank in June 2019, and to reduce the significant structural deficits that loom on both the General Fund and the Transportation Fund for the 2019-21 budget

And I'm sure there are many more ways to use $130 million that help a lot more Wisconsinites. But c'mon parents, take the money.

There's nothing wrong with taking a tax cut because of short-sighted, cynical GOP policies that you hate. - that's the fault of Scott Walker and the Wisconsin GOP. You can only play the game under the rules that exist today, and in 2018, there is no honor in making yourself worse off by playing by the rules you wish we had, so why would you hurt yourself by doing so?

It's not like that one-time tax rebate is going to change your buying habits or economic security, so it's not a move that's going to do much (if anything) to help Wisconsin's economy for 2018, especially in a time of rising gas prices and rents. But you're certainly more than welcome to give it to a cause and/or politician you agree with - after all, that's what right-wing oligarchs do all the time with the tax cuts their puppet GOP politicians give them. What we can do is to elect politicians in 2018 that stop putting us in a position where to stay afloat, we have to wait for the peanuts that trickle down from the corporatism that controls Wisconsin's economic policy.

Instead, let's have an economic policy that is designed for more people beyond a few key constitutencies or donors, with a time frame for an economic strategy that lasts longer than a few days of headlines or getting a few more coporate donations. It's time to get a Governor and Legislature that ynderstands that the best way for Wisconsinites to provide for their families is through good wages, stable communities, and continued job growth, not a one-time check for $200.

Friday, May 18, 2018

The Dark Lord (and massive prison OT) cometh

Hanging with friends and attending my first Dark Lord Day at 3 Floyds Brewery in Indiana. AssuMing I survive it, I'll have more to say later this weekend.

I do have one comment- No surprise that Walker/WISGOP idiocy is now biting taxpayers in the ass to the tune of $42 million in OT at the state's prisons and hundreds of vacant positions. You mean when you take away people's bargaining rights and continue to underpay guards while having 20th Century "lock em up" policies, you have understaffing issues? SHOCKER!

Add it to the pile of reasons the Age of Fitzwalkerstan must end, I guess. Have fun wherever you are at (all 5 of you!)

Thursday, May 17, 2018

Wisconsin with record April....and job loss. Be skeptical

The third Thursday of the month usually means a new Wisconsin jobs report, and sure enough, it gave our Governor a talking point on his re-election campaign.

Here are the toplines from the press release from the Wisconsin Department of Workforce Development, and I’ll italicize one bit of news that is likely as buried in your local press as it is in this report from Scott Walker’s Department of Workforce Development.
Place of Residence Data: Wisconsin's preliminary seasonally adjusted unemployment rate for April 2018 was 2.8 percent, a decline of 0.1 percent from the March rate of 2.9 percent. The April decline is the 3rd straight month that Wisconsin's unemployment rate has declined or stayed the same. Wisconsin's labor force participation rate also increased over the month by 0.2 percent to 68.9 percent. The number of people employed in Wisconsin also increased by 8,100 people setting a new record for the state with 3,086,100 individuals employed. The year over year increase of 42,700 people employed is statistically significant according to BLS methodology.

•Place of Work Data: Based on preliminary data, Wisconsin has gained 11,000 total non-farm jobs and 8,800 private sector jobs over the last three months. Over the month, Wisconsin's total non-farm job number declined by 1,000, and private sector jobs declined by 3,100. Over the year, Wisconsin has gained 27,900 total non-farm jobs and 26,100 private sector jobs, including a statistically significant 13,700 manufacturing jobs according to BLS.
We lost 3,100 private sector jobs last month? Seems kind of important, and we also had March’s private sector jobs total revised down by 700. Granted, some of that can be explained away by the record snows for April (the biggest job “losses” were in Construction, which lost 2,000 jobs on a seasonally-adjusted basis despite having 6,400 more people working overall).

But likewise, the household survey which lists the “record 2.8% unemployment” counted +7,000 in the work force on a seasonally-adjusted basis, while actually having -6,900 for the non-seasonal figure. Seems odd that you’d expect more people to be working in April, but also expect fewer people in the work force at the same time.

Those figures also go with DWD reports which show that unlike the rest of the country, the Walker DWD claims more Wisconsinites are looking for work than at the end of 2017, and even more found jobs in the first 4 months of this year.

Wisconsin household survey, Apr 2018 vs Dec 2017
“Employed” +28,700
Labor Force +17,300

The payrolls part of the report (which gives total jobs) isn't as strong, but is still pretty good.

Wisconsin payrolls survey, Apr 2018 vs Dec 2017
Change in all jobs +19,200
Change in private jobs +15,900

If those numbers are accurate, it seems like things are going great in Wisconsin, and you can choose to believe that if you want. But past history shows that these gains will likely be lowered once they are subjected to the “gold standard”- the Quarterly Census on Employment and Wages (QCEW).

We saw this same routine last year, where Walker’s DWD was claiming that the jobs market was off to a roaring starting in 2017, and it turned out not to be the case.

Change in all jobs Dec 2016-Apr 2017
Walker DWD +27,600
Revised total +11,200

Change in private jobs Dec 2016-Apr 2017
Walker DWD +27,000
Revised total +14,900

Change in “Employed” Dec 2016-Apr 2017
Walker DWD +58,800
Revised total +22,200

Change in Labor Force Dec 2016-Apr 2017
Walker DWD +32,400
Revised total +10,900

With that in mind, take a look at what the DWD was spinning reporting this time last year.
Place of work data: Based on preliminary data, the state added a significant 37,600 total non-farm jobs and a significant 29,300 private-sector jobs from April 2016 to April 2017. Wisconsin also added 7,500 private sector jobs and a significant 14,800 total non-farm jobs from March 2017 to April 2017. Other significant month-over-month gains include 5,100 jobs in Manufacturing.
However, when those figures were benchmarked to the “gold standard” report 2 months ago, the April numbers ended up being a lot smaller.

April 2017 Wisconsin jobs, DWD vs revision
April 2017 change in all jobs
Walker DWD +14,800
Revised total +400

April 2017 change in private jobs
Walker DWD +7,500
Revised total -2,100

Apr 2016-Apr 2017 change in all jobs
Walker DWD +37,600
Revised total +17,900

Apr 2016- Apr 2017 change in private jobs
Walker DWD +29,300
Revised total +21,600

In addition, who in their right mind believes over 50% of the state’s private sector job growth in the last 12 months has been in manufacturing – a sector that accounts for less than 1 in 5 private sector jobs? As recent history tells us, those alleged gains in manufacturing jobs are also not likely not hold up.

Interestingly, Walker’s DWD usually would include information on what they sent to the Bureau of Labor Statistics for that QCEW report along with the regular jobs report that came out today,a nd the tiem frame would show the year-end amounts for 2017. But that wasn’t in today’s press release, which reminded me that that they also hid those numbers this time last year. Why? So they could dump them on the Friday before Memorial Day because they revealed that 2016 had by far the worst job growth of any year Walker has been in office.

Will we see another bad performance for 2017, with another year of job growth below 1%? Figures that we’ve seen so far from the QCEW make that seem likely.

So will we see Walker’s DWD pull another pre-Holiday weekend news dump to bury those facts? That also seems likely. At this point, I’m going to assume any good jobs news from Walker’s DWD will be BS until we get backing data from a non-WisGOP source.

Either that, or DWD Secretary Ray Allen and the rest of the DWD higher-ups need to show their work and explain why it keeps getting the numbers wrong in a way that’s helpful to their boss in the Governor’s Office. And I hope I'm not the only one asking to see the spreadsheets and survey results at this point.