Saturday, September 22, 2012

Wisconsin loses "low-unemployment" advantage

Couple of reports out of D.C. illustrate how the policies in Fitzwalkerstan have eroded something that was a big advantage for Wisconsin until Scott Walker took over in 2011- the state's low and falling unemployment rate.

When Barack Obama took over in January 2009, the country was in the throes of the Wall Street meltdown that was causing the loss of hundreds of thousands of jobs a month. And this was reflected in the spiking unemployment rate, which took till the end of 2009 to stabilize through the ARRA stimulus and other measures. Since then, it's been a slow but relatively steady decline in UE, down to today's 8.1%

Wisconsin was not immune from the problems of the Great Recession, and its unemployment went up like almost everywhere else from 2009 to 2010. But because the state wasn't as invested in the legalized gambling that caused a lot of the collapse, it didn't fall apart as badly as other places like Nevada or Florida, and unemployment never reached double digits here. From January 2010 to January 2011, the state's unemployment fell more than twice as much as the U.S. as a whole, leaving Scott Walker with a state in decent shape when he took office.

Wisconsin unemployment rate 2009-2011
Jan 2009 7.1%
Jan 2010 9.2% (+2.1%)
Jan 2011 7.7% (-1.5%)

Walker's supporters bragged about the state's low unemployment in the recall election campaign, with an example coming from his ex-Hooters Girl spokeperson.
[Ciara] Matthews confirmed that the ad uses Barrett’s whole tenure as mayor for its comparison: “The ad highlights the drastic differences in Governor Walker and Mayor Barrett’s leadership. In just 15 short months, because of Governor Walker’s bold leadership, unemployment in Wisconsin has fallen to 6.8% the lowest it has been since 2008."
Actually Hooters Girl, most of the heavy lifting of that drop was when Wisconsin was under Gov. Doyle and the Legislative Dems from 2010-2011. And as Thursday's August jobs report showed, Wisconsin's unemployment rate has spiked up since that interview in May. Now it's barely any different than when Walker took over 20 months ago, while the U.S. rate continues to fall.

Weekly unemployment claims tell a similar story. While U.S. claims haven't had a year-over-year increase in unadjusted claims since a one-week blip in 2011 (and the one previous to that was in 2009). By comparison, Wisconsin has had 5 weeks of year-over-year claims increases this year alone, including the most recent week listed in early September (shown by a listing above 0 in this graph). This is in stark contrast to the Doyle-Dem budget year of 2009-2010, when new Wisconsin unemployment claims were consistently down 20-30% from the previous year.

And when you compare Wisconsin's trend in unemployment claims with the U.S.'s, you've seen a steady erosion in Wisconsin's advantage since Act 10 was passed in March 2011. Nowadays, it is likely that a year-over-year drop in Wisconsin unemployment claims is due to the improving U.S. economy under Obama, and often Walker/WisGOP state policies are causing increased unemployment claims- which could be theorized when you see any number above 0 on this chart.

Change in y-o-y unemployment claims, Wis. vs. U.S.

So from these charts, it shows that Wisconsin's economy is stalling out and perhaps falling into recession while the rest of the U.S. remains on a slow and steady recovery. Keep it in mind when you think about retaining the Republican Legislature that passed these laws, and left us where we are today.

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