Population trends paint story of Wisconsin’s economic future
An aging workforce and growing cadre of retired workers seem destined to provide difficult challenges for Wisconsin in the future.
That’s the conclusion of a report entitled “The Impending Storm” prepared by the nonpartisan Wisconsin Taxpayers Alliance. It notes that school enrollments have been generally flat since the late 1990s, saying that “suggests that the size of our labor force is in the early stages of stagnation.’’
In the short term, the report notes there can be some job growth because unemployment is still low. But an expected “freeze” in the working-age population over the next 30 years will make long-term job growth difficult.
Employers may end up relying more on Wisconsin workers over age 65 or people who might move in from other states. The report notes wages in Wisconsin are “now more than 10 percent less than national averages.”
Wisconsin employers for several years have reported difficulty in obtaining sufficiently trained workers. Those reports of a labor shortage likely will focus attention on education in November 2014 and future elections in the state.
“No state can afford inadequately prepared high school dropouts when it needs every possible worker,” the WTA report said.
The recent recession has had an impact on Wisconsin population trends. There is an age component in the shifting population numbers.
“Whether due to temperature or taxes, residents in their 60s and 70s tend to move out of the state more than they move in,” report said. “The same is true for those in their 20s and early 30s. Students and young professionals leave Wisconsin to attend college, seek employment or find higher paying work.”
But other age groups are moving to Wisconsin. The state’s good schools and family-friendly public services attract former Wisconsin residents to return. Also returning to the state are people in their 80s who may be coming back to be near families and have better access to quality health care, according to the report.
An aging population also impacts tax collection and government spending, it notes. By the year 2040, retirees will compose nearly one-fourth of Wisconsin’s population, according to state demographers working with census numbers. Retirees have less taxable income and their Social Security payments are totally exempt from the Wisconsin income tax.
Seniors also spend more on food, drugs and nontaxable services and less on the purchase of goods. That likely will put pressure on governments to decide between cutting programs and increasing taxes, it suggests.
Passing referenda could be more difficult as those living on fixed incomes tend to vote more than other age groups and are conservative regarding government-spending issues, the WTA said.
There also are shifts within Wisconsin with a declining population in many rural parts of the state. “The rapidly aging north, with little or no natural increase in population, faces dwindling numbers of residents,” the report said. An 11-county area in the north will see almost a 20 percent decline in the working-age population in the next 25 years.
“Economic prospects for northern Wisconsin become of greater concern when changes in student populations are considered,” the WTA report said. More than 60 northern rural school districts have fewer than five students per square mile, making school transportation very expensive.
Ten years ago, the WTA issued warnings about shifting population patterns in the state. Much of what was predicted in 2004 has become reality, the latest report said.
“The sobering question is: Are Wisconsin leaders any better prepared now to meet the challenges of population change than they were then?”
Matt Pommer, a retired reporter for The Capital Times, writes a column distributed by the Wisconsin Newspaper Association.