| WisBusiness Thursday Trends
6 May 2010
Exclusively for WisBusiness Subscribers
Cranberries: The cranberry industry — of which Wisconsin is the largest producer in the nation — brought in record harvests over the last two years, which created a market surplus and drove prices down. But after several congressmen urge the U.S. Department of Agriculture to step in, the department obliges, announcing it will purchase $18 million worth of cranberry products as part of a package that will go toward federal food and nutrition programs. U.S. Sen. Herb Kohl, D-Milwaukee, says the purchase will eliminate surplus inventories and provide price relief to the struggling industry, which says it supports 7,200 jobs and provides $350 million of economic activity to Wisconsin alone.
Paper: One of Wisconsin’s flagship industries comes out ahead as the U.S. Department of Commerce issues another ruling in favor of domestic paper producers. After the department’s International Trade Commission rules to impose a duty on some forms of imported paper in March, Commerce agrees that unfair trade practices negatively affected American paper companies. If enacted, a tariff on imports from China and Indonesia would be charged to offset the damages. Meanwhile the Central Wisconsin paper company Domtar takes a hit after environmental advocates complain about a donation of paper to a local school, accusing the company of attempting to buy public goodwill as the Public Service Commission weighs its application for a $255 million wood-burning plant. But the company points out it’s made similar donations before, and the paper was on its way to being outdated.
State health care: One of the holes in the state’s health care coverage map — a waiting list for thousands of childless adults to enroll in the BadgerCare Plus Core Plan — is effectively closed as Gov. Jim Doyle signs into law a bill establishing BadgerCare Plus Basic. The bill creates a bare-bones health plan funded entirely by premiums and copays for those already eligible for the Core Plan. Republicans had charged that the government was further intervening in health care and cautioned that Doyle could dramatically increase the scope of the law with his veto pen. But Doyle signs the bill as is, and charges back that he doesn’t know how anyone could oppose the plan that he says won’t cost taxpayers a dime. Doyle also signs bills over the last week to mandate mental health parity in group health insurance plans, and to leverage federal funding for non-profit state organizations who provide services to victims of HIV or AIDS.
Biotech: Wisconsin’s growing biotechnology sector was hurt by the recession, and the state’s 24,694 biotech jobs still only represent a fraction of the 1.4 million such jobs nationwide. But a new report notes that Wisconsin’s biotech jobs have grown by nearly 16 percent since 2001 and the state is one of relatively few making headway in all four biotech sectors historically tracked by the report — agricultural feedstock and chemicals, drugs and pharmaceuticals, medical devices and equipment, and research and testing. The report, unveiled at the annual BIO conference in Chicago, ranked Wisconsin in the top two-fifths of all states in bioscience and biotechnology activity and credited the Badger State for its commitment to academic research and a growing venture capital market. A series of announcements by Gov. Jim Doyle at the BIO conference looks to boost that perception. First, the long-awaited Wisconsin Institutes for Discovery facility will open in December on the UW-Madison campus. Doyle also announces Madison will host next year’s Small Business Innovation Research National Conference, expected to draw 850 attendees from across the country. And there’s good news from outside the Chicago conference as well, as Madison-based Stratatech announces it’s completed a $3 million funding effort to advance clinical trials of a human skin substitute tissue. But the state’s stem cell industry is also dealt a potential setback in a patent decision. California-based Consumer Watchdog and the Public Patent Foundation of New York have long held that the patents on stem cell research owned by the Wisconsin Alumni Research Foundation are invalid. Their lawsuit challenging the patents was rejected in 2008, but that rejected is overturned this week on appeal to the U.S. Patent and Trademark Office. WARF says it intends to appeal the latest decision, and adds that the patents, set to expire in 2015, should be protected by additional patenting measures for much longer.
State manufacturing: Mixed quarterly results roll in for a series of prominent Wisconsin manufacturers. Oshkosh Corp. leads the way, reporting record second quarter sales of $2.9 billion, while Neenah packaging manufacturer Bemis Co. reports that its sales exceeded $1 billion for the first time, aided by its acquisition of British-Australian mining group Rio Tinto. In addition, executives of Briggs & Stratton, Magnetek Inc., Orion Energy Systems Inc. and Signicast report during a panel discussion that their orders over the last six months are all up considerably. But while the future may be brighter for Magnetek, the Menomonee Falls motion control systems manufacturer reports a quarterly loss and a sales decline of 24 percent. Manufacturing results are also mixed on the jobs front. Sheboygan’s International Automotive Components announces it will end most of its operations along, costing more than 100 jobs. And a decision by Michigan-based Federal Mogul Powertrain Systems to close its Schofield plant means 160 jobs will head to Manitowoc from the Wausau area.
University of Wisconsin: The UW System reports mixed results on its graduation goals but positive progress in areas that could have an economic impact. The internal report, titled “Investing in Wisconsin’s Future,” shows the system met its goals for increasing research funding, graduates’ impact on state revenues, and the number of degrees in the economically critical areas of science, technology, engineering and mathematics. The goals of increasing the UW’s revenue stream and collaborations with businesses and community groups were also given high marks. The report says system schools also met goals for enrollment, student retention and graduation rates, but that targeted minority groups lagged behind those goals in most categories.
TANF Program: The U.S. Department of Health and Human Services reaches a new agreement with the state Department of Children and Families to ensure the state won’t discriminate in applications for participation in the Temporary Assistance for Needy Families program — which provides federal grants to states for work opportunities and welfare assistance to low-income families. The Office of Civil Rights investigated complaints that DCF and the state DWD, which formerly administered the program, discriminated on the basis of race and disability in the administration of the W-2 program, and a 2004 DWD report found that over a three-year period the Wisconsin TANF program had significant racial disparities in sanction rates for alleged failures to comply with program requirements, with Latino and African-American participants sanctioned at a rate higher than their white counterparts. But the Office of Civil Rights promises that the new agreement with Wisconsin is “a model for states in preventing unlawful discrimination in their TANF programs.”
Harley-Davidson: The motorcycle manufacturer drops a bombshell late last week, announcing that unless it can cut $54 million in operating costs — largely in labor and scheduling — its entire Wisconsin manufacturing operation could be lost, including some 1,320 jobs in Menomonee Falls and 375 more in Tomahawk. Harley executives say they’ll work with their unions to explore cost-cutting operations, but admit they’ll look to other states for options as well. They also tell Milwaukee Mayor Tom Barrett — the Dem gubernatorial frontrunner — that the company doesn’t want the process to become politicized, but Republicans jump on the announcement as evidence that the combined reporting enacted in last year’s budget is driving jobs out of the state. The current governor counters combined reporting has nothing to do with the potential loss of one of Milwaukee’s signature brands, and the state Commerce Department says it has reached out to the company offering assistance. Commerce also says the last state budget provided plenty of tools — including enterprise zones and consolidated tax credits — to help businesses like Harley. Meanwhile, analysts detect the beginning of a bearish trend in the company’s stock price.
Janesville: The embattled Wisconsin city was tabbed by Forbes Magazine in mid-April as no. 114 on its list of “Best Small Places For Business And Careers.” But it lands much higher on a much more disappointing list this week. Janesville ranks 7th in the country on Forbes’ list of the “10 Worst Cities For Jobs,” down 16 spots from the 2009 list based on its percentage change in non-farm employment rate — it dropped by 7.1 percent from 2008 to 2009. It ranks behind only Morristown, Tenn., two cities in Indiana and three in Michigan, which saw Warren-Troy-Farmington Hills take the top spot on the list. On the local beat, Madison weekly Isthmus declares the Rock County city “on the brink,” saying it risks spiraling into “the same abyss as deindustrialized cities like Youngstown, Ohio, and Flint, Mich.”
Friday, May 7
– 7 a.m.: Legislative Breakfast, Kenosha
Saturday, May 8
– 9 a.m.: Mt. Mary College MBA Open House, Milwaukee
Sunday, May 9
No events listed
Monday, May 10
No events listed
Tuesday, May 11
– 8 a.m.: WI International Trade Conference, Milwaukee
Wednesday, May 12
– 7:30 a.m.: Understanding Obamacare, Waukesha
– 8 a.m.: New North conference on international trade opportunities, Cleveland
– 8 a.m.: Small business of the year/entrepreneur of the year breakfast, Marshfield
– 8 a.m.: Wisconsin Women’s Health Policy Summit, Madison
– 8:30 a.m.: Workplace Dispute Resolutions, Milwaukee
– 11:30 a.m.: 5 Positive Steps…Lunch & Learn, Kenosha
– Noon: Understanding Obamacare, Milwaukee
– 2 p.m.: Wisconsin Women’s Business Initiative Corporation orientation, Milwaukee
– 5 p.m.: Great Lakes Distillery Tour & Networking Fundraiser, Milwaukee
– 5:30 p.m.: Inventors & Entrepreneurs Forum, West Allis
Thursday, May 13
– 7:15 a.m.: Guerrilla Marketing: An interactive and engaging marketing method for any sized business, Appleton
– 8 a.m.: UnGeeked Elite: A Social Media & Marketing Forum, Milwaukee
– 9 a.m.: Obtaining A Business Loan Workshop, Wauwatosa
– 9:30 a.m.: Dept. of Commerce ‘Doing Business Globally’ seminar, Eau Claire
– Noon: Luncheon with president of the 9th District Federal Reserve Bank of Minneapolis, Altoona
– 6 p.m.: TRI-STATE Alliance Opening Reception, Beloit