Wisconsin desperately needs new jobs.

Alone among the 50 states, it has lost private-sector jobs for six straight months, raising the political and economic stakes of the next jobs report, due Thursday for the month of January.

Even feeble job creation would bring a sense of relief to a recession-weary state and a pro-business governor who campaigned on a promise to add 250,000 new private-sector jobs in his current term.

"The rest of the nation is moving upwards. We're one of the few states moving downward. There's something wrong," said economist Steven Deller of the University of Wisconsin-Madison.

The United States as a whole has added private-sector jobs 23 months in a row, including almost a half million jobs in the past two months.

But Wisconsin has been moving in the opposite direction, a trend that not only threatens Gov. Scott Walker's campaign promise but could cloud any message of economic renewal as the state heads into an all-but-certain recall election this summer.

An analysis of jobs data shows that Wisconsin lags the nation in a number of ways that reflect grimly on its economy:

Wisconsin has lost more private-sector jobs (an estimated 27,700) than any state in the country since the middle of last year (July through December), according to the U.S. Bureau of Labor Statistics. Only one other state, Missouri, is close, losing about 19,000 jobs in that stretch.



Although the state added more than 41,000 private-sector jobs in the first half of 2011, losses in the second half of the year have wiped out most of those gains, according to the Bureau of Labor Statistics.



Despite an uptick in December, Wisconsin has the biggest six-month decline in manufacturing jobs in the nation after California. That's significant because Wisconsin depends more on manufacturing for jobs than any state but Indiana. It's also significant at a time when a renaissance in manufacturing is helping drive the national recovery.



Wisconsin's job losses can't be readily explained as part of a broader pattern involving Midwestern or industrial states. Wisconsin's neighbors are all outperforming the state when it comes to job growth over the past six months.



Wisconsin also lags in some broader measures and forecasts. The most recent leading indicators for each of the 50 states, compiled by the Philadelphia Federal Reserve, identify Wisconsin as one of only six states expected to contract in the first half of this year.

Walker declined an interview request, but he and his administration have painted a much brighter economic picture than these numbers suggest.

"Governor Walker's policies have helped turn Wisconsin around," said his communications director, Chris Schrimpf.

In interviews and speeches, the governor frequently calls attention to the state's 7.1% unemployment rate, the lowest since 2008 and lower than the national rate, currently at 8.3%.

But his administration has sounded puzzled at times about the lack of job growth.

"Frankly, it's a little bit inexplicable to us," said Mike Klonsinski, chief operating officer at the Wisconsin Economic Development Corp., the recently restructured state Department of Commerce.

Walker blamed economic and political uncertainty in a late January interview with Mike Gousha on WISN-TV - including the uncertainty created by the recall effort against him and GOP lawmakers.

"Other states don't have recalls," Walker said, before adding, "That's not it alone, believe me . . . There are multiple factors."

A full half year of decline has given rise in Wisconsin to a variety of explanations and arguments about what is going on behind the numbers. No consensus seems to exist. The discussion is loaded with political overtones because of the furious debate over the governor's policies.

But interviews with a dozen analysts and economists netted several theories about what factors might be contributing to the labor-market malaise:

BUDGET IMPACT:

One theory is that the declines are a ripple effect from the austerity budget approved under Walker, who took office in January last year.

Walker and Republican lawmakers cut more than $1 billion over two years from local governments and schools as well as more than $300 million over two years from the University of Wisconsin System, in an age when universities are often relied on as economic drivers. To manage those cuts, they made it easier for local governments, schools and other public employers to save money by making workers contribute more to their health and pension benefits. But that move meant a 7%-8% cut in take-home pay for hundreds of thousands of public-sector workers, meaning those workers had less spending power.

The left-of-center Institute for Wisconsin's Future published an economic analysis a year ago predicting the reduced purchasing power of public employees would result in the loss of almost 10,000 private-sector jobs. "It was certainly ballpark accurate," says the institute's Jack Norman, who notes that private-sector jobs began declining around the time the Walker budget took effect. "Austerity politics is bad economics," he contends.

Economist Deller did his own analyses at the time, projecting similar short-term job losses as a spinoff from the spending cuts.

"The pain of Gov. Walker's budget is working its way through the state," he says.

Ultimately, any effort to close the structural budget deficit that Walker inherited, whether with taxes or spending cuts, "would have come with economic pain," says Deller, a professor of agricultural and applied economics. "The question is which approach would have the least economic pain."

One skeptic about the impact of the budget in job decline is Todd Berry, president of the nonprofit Wisconsin Taxpayers Alliance think tank. He notes that overall state spending actually rose in the two-year budget - not fell - because Walker increased state spending on road construction and Medicaid. What's more, according to a study last month by the Rockefeller Institute, a majority of states have been cutting both public jobs and budgets, meaning Wisconsin is hardly alone.

POLITICAL TURMOIL:

That leads to another frequently cited but less tangible theory.

For the past year, no other state has operated in a cloud of political uncertainty, turmoil and division like Wisconsin, which is about to go through its second round of recall elections that could alter the balance of power in Madison. Without the clarity of knowing who the policy-makers will be, businesses have postponed investments and strategic decisions, according to this theory.

"What we have in Wisconsin is an environment that creates uncertainty and political dysfunction," said Berry at the Taxpayers Alliance. "And if you are trying to manage an enterprise in that environment, you probably do nothing. You just don't hire."

Deller believes both the Walker budget and the uncertainty spawned by the recalls are contributing factors. "A lot of businesses are not sure what's happening," he says.

The uncertainty theory comes with two asterisks. One, it's extremely hard to evaluate because uncertainty can't be measured. And two, the author of the instability is in the eye of the beholder. Democrats blame Walker for creating the turmoil with his policies. Republicans blame Democrats for creating the uncertainty with the recalls.

SKILLS MISMATCH:

When the Metropolitan Milwaukee Association of Commerce polls manufacturers in Southeastern Wisconsin, which has the state's densest concentration of factories, one discontent trumps all others: a chronic inability to fill manufacturing jobs because of a lack of qualified or willing candidates.

It's often called the skills mismatch. And it means that a manufacturing worker who loses his job could have trouble finding a new one, at least without retraining, because manufacturing technology and automation have created a new slate of skills that didn't exist in the last century.

According to the MMAC, more than 5,600 production positions remain open in the Milwaukee region. Of those, 757 positions are unfilled welding and machining positions. "When it comes to hesitancy to hire, a bigger issue than uncertainty - political uncertainty or otherwise - is the inability to find the skilled person," said MMAC president Tim Sheehy.

STRUGGLING INDUSTRIES:

Further, while it's true that factories and machine shops often report rising orders, Wisconsin also hosts a handful of production sectors that clearly are in contraction and don't share in the rebound, said Klonsinski at the Economic Development Corp. No state produces more paper than Wisconsin, but paper mills have been closing as demand for ink-on-paper publishing declines. The state also has a preponderance of factories that make windows, doors and home-construction supplies - all of which have suffered in the real-estate downturn.

EUROPE'S DEBT CRISIS:

In his interview with Gousha, Walker pointed to Wisconsin's reliance on manufacturing exports, which could be suffering from the state's commercial ties to an economically struggling Europe.

Hard export data is not yet available to corroborate the theory. And other states that rely heavily on manufacturing haven't been losing jobs in recent months the way Wisconsin has. Further, Canada is far and away the most popular destination for Wisconsin products and only one of the top five - Germany - is in Europe.

Even so, it's an idea that was echoed last week by Gale Klappa, the chief executive of Wisconsin Energy Corp. and co-chairman of the Milwaukee 7 economic development consortium: "My theory is that the economic difficulties in Europe have had a ripple effect," Klappa said.

STATE BRAND:

A variation on the uncertainty theory involves the state's image to outsiders. Until 2011, the theory goes, the word "Wisconsin" evoked associations with the Green Bay Packers, cheese, cows, cold weather and wholesome images of the Midwest. These days, the state carries a whole different slate of connotations: turmoil, chaos and dysfunction, says Berry at the Taxpayer Alliance. He contends that impairs the state's brand and causes outside investors to rethink any plans to relocate jobs, production or research facilities in the state.

It doesn't matter which party prevails in the political battles because at least one side will remain bitter and angry in the aftermath, Berry said. "The state will still be divided. And the image of the state, its brand image if you will, has been altered by all those looking from the outside.

"Suppose you're the employee of a company that wants to transfer a worker to Wisconsin. If you hear 'Wisconsin' and a job transfer, part of your mind is going to say, 'Isn't that the place that's all screwed up?' "

Amid this debate, the governor has been citing surveys that reflect optimism among some business leaders and focusing on the state's unemployment rate.

It's not uncommon for the unemployment rate and the jobs numbers to move in opposite directions, as they have throughout the recovery. The two figures are extrapolated from entirely different monthly surveys and measure different things, but even government statisticians concede that the unemployment rate is problematic in two ways.

The Bureau of Labor Statistics extrapolates its estimate of jobs created or lost each month from a survey of employers that is eight times larger than its separate survey of households used to estimate the unemployment rate. The "much larger sample size" creates "a smaller margin of error" for the head count tally than the unemployment rate, according to the bureau's website. And under a quirk of U.S. data collection, in the unemployment rate survey, the bureau excludes anyone who gave up looking for work, meaning those people vanish from the statistics and effectively improve the rate.

As long as the two indicators point in different directions, economists concur that the state economy likely is drifting without clear direction.

Another reason why the private-sector job count became a closely watched indicator in Wisconsin is that Walker vowed to use private-sector job creation as a yardstick of his reforms. When the state released a jobs report for June - the last month that Wisconsin added private-sector jobs - Walker went out of his way to tout the figures and take credit for the job growth.

Many of the new jobs in June were in tourism, hotels and bartending and turned out to be short-lived seasonal work. But the figures appeared just prior to last year's legislative recall elections, and Walker took the unusual step of traveling to Milwaukee, holding a news conference and releasing the numbers in person - a departure from the state's custom of issuing the monthly jobs report in a standard news release.

Odds are that Wisconsin will rebound when the January numbers come out, if only to begin to play catch up with the rest of the nation, which registered robust jobs growth in December and January.

But for now, Wisconsin remains 138,800 private-sector jobs short of the level at the end of 2007, when the recession began. In addition, that jobs gap does not take into account the natural growth of the state's population, including young people and graduates who want to work for the first time. To return the state to the same proportion of employment that existed before the downturn, it would need an estimated 66,000 additional jobs, meaning the total "jobs deficit" remains closer to 200,000, said Laura Dresser, a labor economist in Madison at the Center for Wisconsin Strategy.

The loss of jobs was one of the main reasons that Wisconsin ranked so poorly in the Philadelphia Federal Reserve, which tracks a basket of economic indicators in each of the 50 states, said Fed researcher Jason Novak. Only five other states are expected to contract: Alaska, Hawaii, Louisiana, Rhode Island and Wyoming.

Deller, the UW-Madison economist, says the job trend here is very frustrating.

"We're in a rough patch right now. If we're still having this conversation come this summer, then we're in big trouble."

Jason Stein of the Journal Sentinel staff contributed to this report from Madison.