Analyst Finds Gov. Scott Walker May Have Cost Wisconsin 80,000 Jobs

Sep 24, 2018

Updated 2:20 pm

When Gov. Scott Walker mounted his first gubernatorial campaign he made a bold claim: that during his first term as governor he would create 250,000 jobs for Wisconsinites. He is just now nearing that figure after nearly two terms on the job.

Most economists believe that governors have a limited impact on how many jobs are created in a given state. That being said, local economist Bruce Thompson believes Walker’s policies may have actually resulted in a loss of 80,000 jobs in Wisconsin.

Thompson created an algorithm which essentially calculates how many jobs would have been created in Wisconsin, regardless of who was governor. He did this by using data from several states in the upper Midwest: Iowa, Illinois, Minnesota, Michigan, Indiana and Ohio. The data comes from labor reports from each state, collected since 1990.  

Data is from the U.S. Bureau of Labor Statistics, and retrieved from FRED, Federal Reserve Bank of St. Louis.
Credit Courtesy of Urban Milwaukee

"It was all predicting Wisconsin's jobs based on the jobs in those six other states. The idea is that all of these states are pretty much reacting to the same things. They go up when there's a lot of demand for agricultural goods or manufactured things. They all suffer from the global movement of production overseas," says Thompson.

He continues, "The graph before 2011 came out very close, [you] almost can't see the two lines they fit on each other so well. So, the model seemed to work very well for the period before Walker came in." 

READ: Report Finds Slow Economic Recovery Has Still Left Some Wisconsinites Behind

When Thompson applied that same algorithm, the two lines representing actual job growth and predicted job growth were decidedly different.

Data is from the U.S. Bureau of Labor Statistics, and retrieved from FRED, Federal Reserve Bank of St. Louis.
Credit Courtesy of Urban Milwaukee

Thompson explains, "What I found is the model over-estimated what the actual was by about 70-80,000 jobs by this time. And so, one possible conclusion is that the things that Walker did cost Wisconsin 80,000 jobs."

In response to this story, Walker's office offered a statement: 

"More people are working in Wisconsin in 2018 than ever before under Governor Walker’s leadership, wages are up, and we’ve had seven consecutive months of unemployment at or below 3 percent. If you take a look at a whole host of measures, this is the best economy Wisconsin has seen in 18 to 20 years."

Bruce Thompson is a professor emeritus at the Rader School of Business at the Milwaukee School of Engineering. He also writes a regular column for Urban Milwaukee, called “Data Wonk.”

Editor's note: The story has been updated to include a comment from the office of Gov. Scott Walker.