Best & Worst States For Business 2022: Wisconsin Leans In After Near Misses

To the extent it’s possible in a relatively buttoned-up state where cheese curds and beer haven’t yet given way to oat milk and microgreens as dietary staples, economic development in Wisconsin has become something of a wild west.

There’s the recent near-miss on landing Intel and its $20-billion microchip factory that went to Ohio instead. There’s the problem of figuring out whether Foxconn is ever going to do anything significant with its parcel in the southeastern corner of the state that was supposed to be economically transformative. And then there’s the kerfuffle over whether U.S. Senator Ron Johnson doesn’t care about keeping every possible job in his home state.

Yet through it all, Wisconsin doggedly has resumed its rather steady climb in the Chief Executive “Best and Worst States for Business” rankings this year, improving to No. 19 from No. 22. It’s part of a cluster of progressing Midwestern states led by Iowa at No. 17, Michigan at No. 18, and including No. 20 Missouri.

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“We’re focusing on inherent advantages like our growing tech clusters in Madison and Green Bay, and our workforce,” Melissa Hughes, CEO and secretary of Wisconsin Economic Development Corp., told Chief Executive. “Manufacturers love hiring our workforce here. Our kids understand manufacturing, or farming, and that means they understand productivity, efficiency and hard work. So there is a real value to the Wisconsin workforce, and businesses recognize this.”

Intel certainly did, putting the Badger State on the short list for consideration for its new microchip plant. In addition to attributes such as those Hughes mentioned, Wisconsin dangled a great bauble in front of Intel: a mostly empty and unused site of hundreds of acres close to Milwaukee and Chicago, into which governments already had invested $1.4 billion in infrastructure for what was to be a huge glass-screen manufacturing plant built and operated by Taiwan’s Foxconn.

But holdout landowners, local politics and a financial-incentive package that wasn’t quite as attractive as Ohio’s helped scuttle Wisconsin’s chances. “We had a world-class company like Intel looking very hard at coming to Wisconsin, so we’re taking that as nothing but a win,” Hughes said. “And one of the hottest places in the country right now is that corridor between Milwaukee and Chicago.”

Foxconn has drastically curtailed initial plans for southeastern Wisconsin that drew the qualified offer of billions in incentives, and engaged the participation of then-President Trump in the groundbreaking in 2018—but subsequently helped tank then-Governor Scott Walker’s re-election chances after the Taiwan-based company began hedging on ambitious plans for the site that had prompted Walker to nickname the area “Wisconn Valley.”

While still working with Foxconn to tease some kind of industrial presence out of the site, Wisconsin largely has moved on to working with its huge existing base of robust employers. For instance, Generac, a maker of backup generators based in Waukesha, Wisconsin, plans to add 700 new jobs and invest $53 million in its Wisconsin operations though it also subsequently announced a big expansion in South Carolina. Wisconsin extended up to $19 million in tax credits.

Many of the new jobs will be in R&D. “Technology disruption is coming to all industries, ours included,” Generac President and CEO Aaron Jagdfeld told Chief Executive. “Now we have more software engineers working for the company than hardware engineers. Ten years ago that would have sounded ridiculous.”

An hour west of Waukesha, in the state capital of Madison, a tech boom and demand for engineers of all types is burgeoning. The home of the University of Wisconsin lately has been leveraging its technology chops and home-grown entrepreneurs in enterprises such as Epic Systems, a medical-records giant in suburban Verona; Exact Sciences, the developer of the Cologuard cancer-detection test; and Fetch Rewards, a customer-loyalty startup.

“The nice thing about this is it’s regional momentum in the state, with energy pulled in from Kenosha and Racine and Milwaukee and Green Bay, not just Madison,” Hughes said. For example, the Titletown development aside the Packers’ Lambeau Field complex in Green Bay is home to a Microsoft outpost that is anchoring development of a tech community there.

Governor Tony Evers leaned into the inherent strength of Wisconsin’s workforce last year by creating a $100-million fund for “innovation grants” that already have included funding of public-private partnerships to train and attract healthcare workers throughout rural Wisconsin; develop next-generation advanced-manufacturing employees in certain parts of the state; and train construction and skilled-craft workers throughout Wisconsin. “We have a really single-minded focus on producing grads that will serve our industries and businesses in Wisconsin,” Hughes said.

If only the state’s needs were so easy to prioritize for Johnson, the conservative Republican whose adherence to business-friendly and Trumpian principles has made him a lightning rod for criticism from the left not only in Wisconsin but also nationally. After the state’s heavy-truck maker Oshkosh Truck landed a U.S. Postal Service contract and then decided to build up to 165,000 new vehicles at a new factory in South Carolina instead of in Wisconsin — presumably because the United Auto Workers represents the company’s workers in the state — Johnson defended the rights of corporate management.

“When using federal tax dollars, you want to spend those in the most efficient way,” Johnson said, setting up his laissez faire logic. “And if it’s more efficient, more effective to spend those in other states, I don’t have a real problem with that. It’s not like we don’t have enough jobs here in Wisconsin. The biggest problem we have in Wisconsin right now is employers not being able to find enough workers.”