Is Minnesota’s economy leaving Wisconsin behind?

I’ve been on a Minnesota-Wisconsin economy comparison kick since January. That’s when Wisconsin Gov. Scott Walker resumed his “Wisconsin Open for Business” rhetoric.

As we’ve noted in several posts (find them here and here) Wisconsin talks a better game than it plays when it comes to economic success. The facts show Minnesota performed better than the Badger State in keeping people employed during the Great Recession and adding jobs in the recovery.

Now, though, new data show Minnesota may be starting to pull away.

Here’s a look at the state monthly coincident index produced by the Federal Reserve Bank of Philadelphia.

mnwi2007.jpg

The index is a good apples-to-apples comparison, combing four indicators (nonfarm payroll employment, average hours worked in manufacturing, the unemployment rate, and inflated-adjusted wages) into a single statistic.

Wisconsin’s underperformed the U.S. and Minnesota throughout the recession and recovery. The February data show a marked uptick for Minnesota over Wisconsin.

Here are the same data indexed to a common starting point in November 2007, just before the recession began.

mnwi1.jpg

And finally a map of Minnesota’s growth compared to other states from December through February.

phillycoincident.jpg

Dark green is best. So there’s a lot to like there if you’re in Minnesota and, well, less to like in Wisconsin.

Need more proof?

Here’s a chart published on Forbes.com Tuesday by the economic modeling group EMSI.

mnwi2.jpg

Again, I’ve noted in other posts that the data don’t end the discussion about taxes and spending or the effects of fiscal policy on business decisions.

From 1980 through the early 2000s, Minnesota and Wisconsin ran neck-and-neck in these key economic measures.

19802.png

Minnesota started to outpace Wisconsin roughly a decade ago and survived the recession in better shape. Now Minnesota’s economy may be starting to leave Wisconsin behind.

BONUS: MPR News colleague Will Lager shared this recent Milwaukee Journal Sentinel story showing Wisconsin near the bottom of states in private job creation. Minnesota’s not great in this regard, but still better than the Badger State. Goodbye, Wisconsin.

  • http://mpr louis

    Well, when your gov spends most of his time warming up for a potential run at the white house in 16, I guess there isn’t much time to fullfill the past elections goal of adding 250,000 jobs here in Wisconsin. Then again, what’s good for the far right of America must be good for Wisconsin as well……..NOT!

  • http://www.growthandjustice.org Dane Smith

    Outstanding work and especially timely, Paul, and here’s what I posted on my Facebook page. “This is one of the more instructive refutations out there for those who claim anti-tax, anti-government policy& politics is always better for business growth. Minnesota and Wisconsin are practically sister states demographically and ideal for comparison. Their governors’ policy directions and strategies for growing jobs could not be more different. Look at the numbers. The larger truth is that tax policy at the margins simply doesn’t have all that much impact on economic performance, state to state. North Dakota is a low-tax state that’s booming, but everybody knows it has little to do with taxes.

  • vasa alumnus

    Republican House and Senate in MN during much of the critical time cited didn’t have the mess WI had to endure first with legislators hiding from votes and union sick outs and all that drama. The GOP is the reason for the recovery trajectory at this point. The DFL and unions in WI did their state a disservice when it needed them

  • Michael

    I live in Wisconsin. It’s interesting to watch how an unequivocal “250,000 more jobs” becomes “let’s find some way to blame the minority party when we screw up”.

    Wisconsin has a Republican governor, assembly, and senate, and has since 2010 except for a brief period when a Republican senator was recalled — and during those six months, absolutely nothing happened.

    The Republicans have 100% of the power. They can pass any law they want. The governor can’t be recalled again during his term. They have carte blanche to enact any policy they can dream of. And they still can’t even come close to 250,000 new jobs. And it’s fascinating to see that they blame the Democrats (who hold no power), the state employees (who have had their working conditions, insurance, and pensions gutted to save people $7 on their property taxes), and the public sector unions (who have no power whatsoever in Wisconsin anymore).

    Republican MO: when your policies fail, blame someone else and continue worshiping your governor.

  • Escape Wisconsin

    Hooray for Minnesota!!! Best wishes to keep leaving Wisconsin in the dust!!

    Wisconsin has a public education policy driven by extreme, almost visceral hatred for teachers. Minnesota, with a knowledge based economy has benefitted greatly by the exodus of thousands of Wisconsin’s best young teachers seeking careers that pay professional wages AND where teachers are not bashed and sworn at 24/7 365 days per year.

    As a veteran Advanced Placement teacher, I am too old to leave Wisconsin for the bright sunshine of the Minnesota economy, but I have been able to direct many of my best and brightest students to colleges in the Twin Cities, instead of UW-Madison. With the booming Minnesota economy, these youngsters will likely never return to Wisconsin.

    Just doing MY part to help these youngsters find the best possible futures.