Paul Gores

Milwaukee Journal Sentinel

Northwestern Mutual Life Insurance Co.’s 32-story downtown tower project should help the company recruit top professionals from across the nation — something that's not always easy because of Milwaukee’s perception to outsiders, the insurer’s top executive said Monday.

John Schlifske, chairman and chief executive officer of Northwestern Mutual, said there remains a “Laverne and Shirley” view of Milwaukee by people unfamiliar with it.

“There’s this perception about Milwaukee that I think is unfortunate, that it’s a sort of stodgy, sort of behind the times — whatever the opposite of hip and trendy is,” Schlifske told a group of business leaders at a meeting of the Greater Milwaukee Committee.

However, it’s not only that dated, uninspired view of the city that hurts the community's reputation, according to Schlifske, a native of Shorewood.

“We have some very strong problems. We have a racial issue in the city. We have an educational issue in the city. We have disparate achievement in the city, and I think we need to work on all of those. And I believe we can,” Schlifske said.

Schlifske said he thinks Milwaukee is small enough that the problems can be tackled and solved.

Schlifske said the company’s state-of-the-art, $450 million Tower and Commons project being built near the lakefront is the kind of facility the company needs to be able to draw “knowledge workers” who can keep Northwestern Mutual at the top of its industry over time. The interior of the building will be especially geared toward the “collaborative” and around-the-clock work styles of millennials, featuring health facilities, dining and other amenities they seek.

“We don’t necessarily have the best reputation when you are trying to recruit people,” Schlifske said. “But what I do know is when you get people to come here, they stay here and they love it here — other than the climate.”

With about 5,900 employees at its downtown and suburban Franklin locations, Northwestern Mutual is one of metro Milwaukee’s largest employers.

Schlifske said community leaders need to ensure, while working to change negative views of Milwaukee among people who don’t live here, that it remains a place they want to remain once they become familiar with it.

He said while the Tower and Commons project, which is on track to open next August, shows the company’s commitment to Milwaukee, it truly is necessary for its business operations in the future.

“What separates Northwestern Mutual from, I think, the rest of the companies in our industry, is our talent,” Schlifske said.

At the meeting Monday, Schlifske was asked to explain how recent news that the company is planning to pare its local workforce fits with building a huge project.

The company hasn’t said how many positions may be eliminated or what the time frame for the layoffs could be. However, a spokeswoman for a union representing about 1,200 Northwestern Mutual workers has said she wouldn’t be surprised if the cuts number in the hundreds.

Schlifske said that while the Tower and Commons is part of the company’s long-term business strategy, a long lingering low-interest rate environment has put pressure on insurers’ revenue and created the need for the company to be more efficient in the near term.

Low interest rates make it more difficult for insurers to grow earnings because insurance companies invest premiums from policy owners mostly in relatively safe investments tied to rates.

“We are the strongest company in the industry, we’re AAA rated, we have the best balance sheet of any of our competitors, the best cash flow of any of our competitors, and we just have to navigate this paradox of great growth on the sales side and incredible financial pressure from the revenue perspective,” Schlifske said.

Schlifske said he wanted to "assure everyone" the company is committed to Milwaukee and the state.

"It's all a balancing act between the long-term future of our company, which is what this Tower and Commons is all about, and the need to manage expenses in the short run," Schlifske said.