MON AM News: Milwaukee manufacturers more optimistic about 2024 than other businesses, survey finds; Xcel rolls out new clean energy plan

February 4, 2024

— Milwaukee-area manufacturers are more optimistic about 2024 than other businesses in the region, according to the latest Metropolitan Milwaukee Association of Commerce survey.

Seventy-one percent of surveyed manufacturers expect sales to increase this year, while 13% expect sales to fall. By comparison, 54% of non-manufacturers predict higher sales in 2024 and 3% expect sales to decline.

Also, 52% of manufacturers expect to add jobs this year, while 45% expect no change and 3% expect fewer jobs. For all other businesses, 38% expect to add jobs, 49% expect no change and 13% expect job declines, according to the survey.

Across all respondents, sales expectations for this year are lower than at this point in 2023, MMAC found. Sixty-one percent of businesses forecast higher real sales for 2024, compared to 70% at the start of last year.

Similarly, 61% of respondents expect profits to increase this year, just below the 63% from last year’s first-quarter survey. And 10% predict profits to fall this year, while 29% don’t expect them to change.

“In percentage terms, expectations are tepid for 2024’s first quarter, but optimism polled higher for the year as a whole,” said Bret Mayborne, MMAC’s vice president of economic research. “That optimism provides hope for better growth dynamics as the year moves forward.”

Businesses with 100 or more workers are more likely to predict higher sales for the year, MMAC found, with 75% compared to 47% of small employers.

Following last year’s relatively slow job growth — 0.4%, compared to 2.2% in 2022 — the survey suggests “mixed employment prospects” for this year. Forty-seven percent don’t expect job levels to change, 44% expect job gains in their local workforces and 9% expect job declines, the survey shows. By comparison, 53% of respondents at the start of 2023 had expected job gains for the year.

And as a result of the slow job growth, expectations about future wage and salary increases have diminished slightly. The average change in per-person employee pay is forecast to increase 3.6% over the coming year — down from the 4.2% annualized increase predicted three months ago, according to MMAC.

See the full survey.

— Xcel Energy expects to reduce baseline carbon emissions 80% by 2030 under the Minneapolis-based utility’s newly announced plans for the Upper Midwest.

The company, which serves customers in eight states including Wisconsin, recently proposed a new clean energy plan that includes extending the operation of two nuclear plants through the early 2050s.

That would entail operating the two Prairie Island Nuclear Generating Plant units through 2053 and 2054, and the Monticello Nuclear Generating plant through 2050. The company’s nuclear plants make up about 30% of its total electrical generation in the region, according to the announcement.

“This new proposal builds on our already-approved plans to retire all coal plants by 2030 and replace them with nation-leading amounts of renewable energy like wind and solar, as we transition to a clean, secure energy future,” said Ryan Long, president of Xcel Energy Minnesota, South Dakota and North Dakota.

Under the plan, Xcel says it will also add 3,600 megawatts of new wind and solar facilities by 2030, add 600 megawatts of battery energy storage by 2030 and create a reserve of 2,200 megawatts of “always-available” power to support power access during peak demand periods.

The company also plans to extend the life of the French Island fuel plant in La Crosse through 2040, though that will require “additional investments and potential approvals” from Wisconsin regulators.

See more details in the release.

— Interest groups spent 2,234 hours over the last half of the year lobbying on a hotly debated transmission line bill, nearly double the effort they put in on the second most lobbied bill over the period, according to a WisPolitics review.

Senate Majority Leader Devin LeMahieu, R-Oostburg, and Assembly Speaker Robin Vos, R-Rochester, both told WisPolitics in separate year-end interviews the legislation — dubbed right of first refusal by supporters — was a priority for the spring floor period.

And the fight is coming down to the wire with weeks left in the session. Neither house has put the bill on the floor yet, despite each version passing out of committee in November. What’s more, of the three most lobbied bills over the six-month period, it’s the only one that hasn’t yet cleared the chambers.

Lobbying reports filed with the Ethics Commission this week show groups spent $18.7 million over the last six months of 2023, topping the $17.4 million they dropped over the same period in 2021.

For all of 2023, interest groups spent $39.1 million trying to influence the Capitol, compared to the $35.5 million reported for 2021 as things were still getting back to normal from the COVID-19 pandemic.

After the filing deadline, WisPolitics asked the Ethics Commission for details on the lobbying efforts on individual bills over the last half of 2023. It then used the information to compile the most lobbied bills over the period.

“ROFR” was ahead by a mile.

The bill was drafted in anticipation of new transmission line work coming into Wisconsin. The Midcontinent Independent System Operator, the regional electric grid that covers the upper Midwest, has approved $10 billion in work on new transmission lines over the next decade, with Wisconsin expected to see about $2 billion of that.

SB 481/AB 470 would give utilities already doing business in Wisconsin the right of first refusal to construct, own and maintain a new transmission line that connects to one of their existing ones.

The debate has pitted those who argue it would bring continued stability to the state’s transmission system against those who believe it would stifle competition and lead to higher costs for ratepayers.

See more at WisPolitics.

Top headlines from the Health Care Report…

— UW-Madison researchers have created the first 3D-printed functional human brain tissue, giving scientists a new tool for understanding the brain and related diseases.

For more of the most relevant health care news, reports on groundbreaking research in Wisconsin, links to top stories and more, sign up today for the free daily Health Care Report from WisPolitics and WisBusiness.com.

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TOPICS

AGRIBUSINESS

– New crop insurance fact sheet for specialty and organic grains

– Wisconsin judge affirms regulators can force factory farms to get preemptive pollution permits

CONSTRUCTION

– Madison developer hints at plans for ’50-story-plus’ tower at Marcus Center parking structure site

– FPC Live prepares to break ground for construction of concert venue near Fiserv Forum

ECONOMY

– MMAC survey finds ‘tepid’ expectations to start year