Madison job growth ranks in the middle of the pack


Mike Ivey


Madison Capital Times

When economists read the statistical tea leaves, seeking signs of an easing recession, they often look for a bottoming of the stock market or an uptick in factory orders.

But the economic picture for thousands of working people across Wisconsin won’t improve until the job picture brightens. And on the jobs front, there’s some good news for Madison, which was just rated No. 1 among medium-sized cities for so-called Next Generation workers. These are younger, tech-savvy people who want “a good job in a great city,” according to Next Generation Consulting, which produced the list.

But what about workers with less education who aren’t part of the “knowledge-based” economy? Or older workers whose manufacturing plant has been permanently shuttered?

To that end, Madison scores no better than middle of the pack, according to a report that rates all 333 metropolitan statistical areas in the U.S. on actual job growth numbers. Among medium-sized cities, the Madison area ranked 43 out of 97, right between Santa Barbara, Calif., and Harrisburg, Penn., and well behind McAllen, Texas which was rated No. 1 in the annual survey from

“What’s bizarre is that so many places are focusing on those who least need the help,” says study co-author Joel Kotkin. “But we need to create something for people who don’t have a Ph.D.”

Madison’s ranking actually represents an improvement over 2008 when it ranked 67th in job growth among medium-sized cities. But Kotkin, a scholar on urban development who is currently a fellow at Chapman University in Orange, Calif., says in a phone interview that the new rankings are somewhat skewed because the bottom has fallen out of the economy in Florida and California.

“Those places have just tanked, which pushed everybody up the list,” says Kotkin, who visited here in 2004 at the invitation of Mayor Dave Cieslewicz and spoke at Monona Terrace about “Healthy City: A Model for a Forward Economy.”

Indeed. In the five years they’ve compiled their jobs report, Kotkin and co-author Michael Shires of Pepperdine University have seen the nation’s employment picture go from red hot to icy cold. Some places had been adding jobs at annual rates of 3 to 5 percent but a 1 percent growth rate was considered strong this time around.

For Madison, the biggest challenge may come in trying to replace some of the government jobs that are being lost. The percentage of Dane County workers who hold public sector jobs has fallen from nearly 35 percent in the 1970s to just 20 percent today.

But Noel Radomski, director of a higher education think tank at UW-Madison and former City Council member, says the city is only beginning to get aggressive on the job creation front.

Radomski notes that until recently, Madison used tax increment financing (TIF) to fuel the growth of higher-end condominiums in the downtown rather than as a job generator.

“We need to ask, over and over and over again: what impact are our decisions having on job creation?” he says.

Radomski also maintains the city must be “more judicious” in following the recommendations from existing or emerging neighborhood plans — especially if they put up red lights for future infill development. “City staff and elected officials need to speak for the future of the city and put questions out to the public rather than accept simple solutions ” he says, referring to the recent approval of the Hy-Vee grocery story in Westgate, which he claims will stymie additional redevelopment of the blighted mall.

Moreover, Radomski says Madison should be encouraging start-up companies in lower-cost facilities that are already fully integrated into the city rather than encouraging new office parks on the urban fringe. He applauded the recent move by University Research Park to site its “Metro Innovation Center” in the long vacant Marquip Building on East Washington Avenue.

Jennifer Alexander, president of the Greater Madison Chamber of Commerce and the regional development group Thrive, says business leaders are well aware of the need to create more jobs. She noted that Thrive is focused on health, biotech and agriculture. “You need to focus on the unique assets in this region,” she says. “That’s our sweet spot.”

Alexander says Thrive is aimed at growing local business rather than trying to lure existing companies to move into the area from other states. “Home-grown jobs mean more of an investment in the community,” she says.

City business development liaison Michael Gay says Madison is taking job growth seriously. He pointed to the recent decision by the City Council to invest $2.6 million in the BioAg Gateway project on the far southeast side.

“We are getting away from subsidizing downtown development and getting more into job creation,” says Gay. “But it’s going to take some time to make that effective.”

Gay noted the city’s efforts to spur redevelopment of the shuttered Royster Clark plant on Cottage Grove Road and its support for the Capitol Gateway Corridor along both sides of East Washington Avenue between Blair Street and the Yahara River.

At the same time, Gay admits the city has been hurt by the ongoing loss of blue collars jobs: Sub-Zero, Spectrum Brands and most recently the announced closing of the Land O’Lakes butter plant on East Washington.

“We’re trying hard but there is only so much you can do,” says Gay.

Radomski doesn’t doubt that officials are working overtime but says the city still sends mixed messages. Case in point: the behind-the-scenes discussions over offering TIF to the Milwaukee-based Marcus Corp. for a new downtown hotel.

“Again, this is an example of thinking in isolation and in private,” he says.

Overall, Texas remains the best state for job growth, according to the study. The Lone Star State is home to eight of the top 20 cities in the ranking — including Odessa, ranked No. 1 among small cities. The top five large metropolitan areas for job growth — Austin, Houston, San Antonio, Ft. Worth and Dallas — are all in Texas’ “urban triangle.”

Author Kotkin says a healthy energy industry has kept Texas growing. Energy companies, he notes, employ large numbers of people at fairly high salaries for both blue- and white-collar workers.

Other top-ranked locales such as Grand Junction, Colo.; Houma-Bayou Cane-Thibodoux, La.; Tulsa, Okla.; Lafayette, La.; and Bismarck, N.D., also have energy jobs.

Another major factor influencing the 2009 rankings was the severity, by region, of the housing crisis.

“There’s a ‘zone of sanity’ across the middle of the country, including Kansas City, Mo., that largely avoided the real estate bubble and the subsequent foreclosure crisis,” says Kotkin.

On that front, Kotkin adds, Wisconsin should consider itself lucky: “You’ve got a great diversified economy, and you don’t really boom or bust,” he says.

Just don’t tell that to the 10 percent of Wisconsin workers who filed for unemployment last month.