Manufacturing sucks in Wis under "gold standard", and exposes tall tales from Walkerland

I wanted to go back to one particular aspect of this week's release of the "gold standard" Quarterly Census on Employment and Wages (QCEW) - manufacturing. If you go into the manufacturing figures on the handy QCEW web site, you'll see that Wisconsin was one of many states that had a 12-month increase in manufacturing jobs between June 2017 and June 2018. We added 8,604 manufacturing jobs in that time, a 1.8% rate of increase which placed us 28th in the nation.

Kind of disappointing, given that Wisconsin has one of the highest proportion of manufacturing jobs in the country, so you'd think we'd benefit a lot from growth in that sector. But what's worse is when you compare those figures to what Scott Walker’s Administration was saying when they released their jobs estimates for June 2018.

MADISON – Department of Workforce Development (DWD) Secretary Ray Allen released the following statement on today's release by the U.S. Department of Labor's Bureau of Labor Statistics (USDOL/BLS) showing that Wisconsin's significant addition of 17,600 manufacturing jobs from June 2017 to June 2018 ranked 2nd nationally and 1st in the Midwest, while the addition of 2,600 manufacturing jobs from May 2018 to June 2018 also ranked 2nd nationally and 1st in the Midwest….

"Under the leadership of Governor Walker, businesses across many industries are confident in the direction of the Wisconsin economy, they are adding jobs and Wisconsin workers are reaping the benefits," Secretary Allen said. "More than 3,000 people entered the labor force in Wisconsin from May to June, and it's easy to see why; workers are excited about the great career opportunities available, many of which are being created in Wisconsin's high-paying manufacturing industries."

That alleged 12-month increase in manufacturing jobs was later revised even higher, to 18,700.

Now compare that to what the “gold standard” report said this week. In the QCEW, Wisconsin didn’t even gain HALF the jobs in manufacturing that Walker’s DWD claimed 5 months ago, was 6th out of 7 in the Midwest for job growth in manufacturing. We also didn't even keep up with the growth in the US as a whole.

Manufacturing jobs, Midwest Jun 2017-Jun 2018, QCEW
Iowa +3.3% (+7,202)
Mich +2.6% (+16,289)
Ohio +2.1% (+14,231)
Ind. +2.2% (+11,603)
Ill. +2.0% (+11,386)
U.S. +1.9%
Wis. +1.8% (+8,604)
Minn +0.9% (+2,816)

This is far from the first time Walker’s DWD has overstated the amount of jobs being added by state manufacturers. UW's Menzie Chinn previously produced this chart at the Econbrowser web site that shows revisions from prior years.

Last year's monthly DWD numbers were benchmarked at the start of 2018, so there are few changes there, but once the benchmark period was over, Walker's DWD was back to overestimating growth at the start of this year, a gap that grew to more than 10,000 by June.

How can the Walker DWD continue to “overestimate” job growth in the state’s manufacturing economy this badly? Are Wisconsin manufacturers lying about how many people that are working when they submit the information to Walker’s DWD? Or was Walker’s DWD fudging the numbers that businesses were giving them?

Either way, there should have been an adjustment to account for these consistently too-high jobs numbers. But I bet Ray Allen and company at the highest reaches of the DWD didn’t care to improve accuracy as long as they thought their originally-reported numbers would help their chances of keeping their own jobs via Scott Walker’s re-election.

And let me conclude with another bad trend in Wisconsin manufacturing continued in this report, where Wisconsin still had the worst manufacturing wages in the Midwest, and further behind our neighbors in Michigan, Minnesota and Iowa.

Average weekly manufacturing wage, Midwest June 2018
Ill. $1,284 (+$11)
Mich $1,248 (+$25)
Minn $1,248 (+$31)
Ind. $1,138 (+$9)
Ohio $1,124 (+$16)
Iowa $1,096 (+$26)
Wis. $1,077 (+$23)

Maybe that whole "give manufacturers major tax breaks and wage suppression" strategy of Scott Walker and WisGOP isn't translating into good things. And the latest "gold standard" report gives more proof behind Tony Evers' argument to end the Big Giveaway for manufacturers making $300,000 or more, and use the money for people and programs who will actually do things that might improve our economy.