David D. Haynes

Milwaukee Journal Sentinel

Lowest unemployment rate in years. Most people working ever.

“The last time the unemployment rate was so low, my friend Tommy Thompson was governor.”

That’s a favorite brag of Scott Walker as he prepares to run for a third term as governor.

But is the picture he’s sketching realistic? Or is he airbrushing out a few key details?

To find out, I got in touch with Prof. Steven C. Deller at the University of Wisconsin-Madison-Extension, who has followed the state’s economy closely and who dug up a wide range of data for me to review. I also took a close look at a recent Politifact Wisconsin report by Tom Kertscher that rated Walker’s statement — “Wisconsin’s economy is in the best shape it’s been since 2000.” — as only half true.

What I found, no surprise, is that a smart politician is trumpeting good news and burying bad. The truth is that plenty of the data on the state’s economy right now is just plain blah. One example: Wisconsin has long trailed the national average for per capita income by a tad, Deller says. But recently, we've fallen just a bit further behind the nation. That's not horrible. But it's not good news, either.

Politifact found a mixed bag when it examined Walker's bold claim. To quote just one example: While real GDP per capita is trending higher (that's the total value of goods and services produced, divided by the population and adjusted for inflation), the poverty rate is going up, too. I haven’t heard Walker talking about that.

Here are five additional measures of economic well-being that provide a clearer picture of what’s really happening in Wisconsin:

We’re hard workers in the Badger State. You can see that in the employment-population ratio, which measures the proportion of the population that is working (data from the U.S. Bureau of Economic Analysis, Regional Economic Information System). That number grew steadily from the early 1970s through the year 2000 as women entered the state’s labor force. Since then, it has leveled off, indicating that that pool of labor is tapped out. That means that unless we start having more babies or a lot more people move into the state — or we welcome more immigrants — we may have problems fueling future growth.

Employment growth remains sluggish. That is evident in this index of total employment growth (BEA-REIS data) below. For years, the rate of employment growth in the state tracked pretty closely to the U.S. as a whole. But since 2003 — and especially since the Great Recession — we’ve lagged, Deller said. Since the end of the recession, Wisconsin’s annual employment growth rate was about 0.85% compared with the nation’s 1.48%, he calculates. Thus, a gap is opening between how fast employment is growing in the U.S. as a whole compared with how fast it is growing in Wisconsin.

That low headline unemployment rate that Walker touts — 3.4% in the latest monthly report (lowest since 2000) — doesn’t capture the whole picture (U.S. Bureau of Labor Statistics data). Deller pulled quarterly numbers through the fourth quarter of 2016 to see the trends. At that time, the “official” unemployment rate in Wisconsin was 3.8%. But if you included everyone who had given up looking for a job, was working only part-time or who wasn’t working up to their potential (say a laid-off machinist clerking at Wal-Mart), that figure ballooned to 7.7% (what the government calls the "U6" rate). Needless to say, underemployment remains a problem for workers in Wisconsin, a state that has shed 130,000 manufacturing jobs since the year 2000 as automation and offshoring took their tolls. Amy Goldstein's brilliant, "Janesville: An American Story," chronicles what happens when manufacturing jobs leave a community. I've been reading it and I recommend it to anyone who wants a realistic picture of the challenges some of our communities face.

While per capita income has fallen a smidgen more behind the U.S. average in recent years, the more telling statistic may be the average wage and salary per job when compared with the U.S. average (BEA-REIS data). It has trended lower since the late 1990s. Deller says he and his colleagues believe that may be because Wisconsin is “top heavy in older legacy industries that foster profitability by driving costs down.”

And finally, let’s look at income inequality. There are various ways to measure it but for simplicity, I’ve chosen the share of Wisconsin income going to the top 10% of income earners. Like the nation as a whole, inequality has been increasing (data compiled by Prof. Mark Frank of Sam Houston State University).

As Deller told me:

“What we’re finding is a widening income gap — you can really look at it in terms of education lanes. If you have a college degree and you’re willing to move around a bit, you do fine. The problem is people who have a high school diploma and are not mobile — those folks are kind of stuck.”

Walker has practically made a Gregorian chant out of the state's low unemployment rate. But without a closer look at a wider range of statistics, that single figure is misleading at best. In fact, Wisconsin has modest job growth, lagging wages for the working class and rising inequality that favors the well-to-do.

So, if you’re wealthy, college-educated, or both, you’re probably not too worried. If not, you may have voted for Donald Trump.

Can Walker’s happy days rhetoric work in a state where so many people were so open to persuasion by an angry populist last November? We’ll soon see.

David D. Haynes is editorial page editor for the Journal Sentinel. Email david.haynes@jrn.com Twitter: @DavidDHaynes