FOR FURTHER INFORMATION CONTACT: James S. Haney, (608) 258-3400
Jim Pugh, (608) 219-0157
National Economy May Start to Improve in Next Year
MADISON — With unemployment topping 9 percent this year, Wisconsin’s top business executives are predicting the state’s economy will continue to decline, with modest growth predicted in the national economy, WMC announced Thursday.
Additionally, 48 percent said Wisconsin’s business climate is somewhat anti-business, and 34 percent said “very anti-business,” according to the survey of WMC’s board of directors. Three percent said Wisconsin is somewhat pro-business, and 14 percent said “neutral on business.”
Those are some of the results of the WMC 2009 Economic Outlook Survey (http://www.wmc.org/PDFfiles/BoardSurvey_June09.pdf) of WMC’s board of directors. WMC is the state’s largest business association, representing 3,500 employers that employ 450,000 workers.
In the next year, 48 percent predicted Wisconsin’s economic growth will decline, and 48 percent said the economy will “remain flat.” Nationally, 21 percent said the national economy will decline, 55 percent said the nation’s economy will remain flat and 21 percent predicted growth.
“There is a startling disconnect between the economic reality and the policies being advanced at the Capitol,” said James S. Haney, WMC president. “Wisconsin’s economy is in a significant recession, yet higher taxes, more regulation and increased liability have been on tap in the Legislature. It’s a very disturbing dynamic.”
The Wisconsin Legislature is considering, or has already approved, $3 billion in higher taxes, including increases in corporate income taxes, personal income taxes, gross receipts taxes on petroleum product sales, telephone tax and others. Additionally, the state budget had included a return to joint and several liability that would increase jury awards against employers.
“Fortunately, Assembly Democrats yesterday removed joint and several liability from the state budget, ” Haney said. “It needs to stay out.”
In the WMC survey, some 96 percent of respondents say Wisconsin has “seriously gotten off on the wrong track.”
The WMC 2009 Economic Outlook Survey (http://www.wmc.org/PDFfiles/BoardSurvey_June09.pdf) found that CEOs are concerned about the state and national economic slowdown, with the slowing economy rating as the top concern facing their businesses. Some 83 percent said the slowdown was the top problem for their business this year, up from 38 percent last year.
In the public policy arena, high taxes were the top issue with 52 percent citing taxes as the top public policy priority facing Wisconsin, with the economic slowdown ranking second at 38 percent.
Asked how to improve the state’s business climate, two answers dominated the responses: “cut taxes” and “be more pro-business.”
Seventy-nine percent said they will not be expanding in Wisconsin in the next two years. Fifty-two percent said they will be expanding elsewhere; and 48 percent said they will not be expanding in other states or countries.
Forty-one percent said they would be cutting jobs, with 47 percent predicting no change. Thirteen percent said they would be adding jobs.
Seventy-two percent said wages would be frozen, or only increase up to 2 percent next year. And 22 percent predicted wage hikes up to 2.9 percent.
Employers remain committed to training, with 69 percent dedicating 3 percent of payroll to training. And, 31 percent commit 3.1 to 5 percent of payroll to training programs.
“Clearly, despite the slowdown, employers are investing in their employees so their businesses are positioned for the future,” Haney said.
The WMC Economic Outlook Survey is comprised of answers from the WMC Board of Directors to a 25-question survey about economic conditions in Wisconsin. The survey results are being released today in conjunction with the WMC board meeting in Wisconsin Dells. The survey was conducted online in May.
Thirty-two CEOs completed the survey, with 22 respondents operating businesses with more than 500 employees. The WMC Economic Outlook Survey (http://www.wmc.org/PDFfiles/BoardSurvey_June09.pdf) provides insights into the future of the Wisconsin economy as the future of large employers drives economic activity statewide.
For a complete history of the WMC Economic Outlook Survey, click here (http://www.wmc.org/MediaOutlet/display.cfm?ID=432) .
The results mirror a WMC Foundation economic outlook survey conducted earlier this year of 114 Wisconsin chamber of commerce executives who said hiring would be down, and expressed concerns about the direction of the state’s economy.
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