We are committed to business. We are a state that is driven to succeed, and we have the can-do spirit to achieve our goals and raise our economic competitiveness by focusing on our unique strengths. Defining and identifying our economy’s strengths, or what we refer to as key driver industries, are essential to maximizing growth in our state. Creating sustainable prosperity in Wisconsin requires a common purpose between state government and the many local partners throughout the seven regions that comprise our economy. To better understand how we can achieve that goal, the Wisconsin Economic Future Study was conducted in 2004 and most recently refreshed in 2011.
The study compared the performance of Wisconsin’s economy with eight select states that were classified as our “competitors”—Minnesota, Illinois, Michigan, Indiana, Ohio, Pennsylvania, Georgia and North Carolina. Those competitor states are similar in size, industry composition and competitive strength to Wisconsin. The study found that Wisconsin outperforms some and underperforms others on the key measures examined, with variations in performance from year to year.
To help the state focus on the areas where it can be most competitive, the Wisconsin Economic Future Study was initiated to examine and define:
According to the study, we, in Wisconsin, can positively impact driver industries and our state’s business climate by:
The study assessed Wisconsin’s competitiveness by examining export, innovation and workforce performance of Wisconsin’s key driver industries, and compared those to competitive states and the U.S. as a whole. It reviewed the state’s business climate and the opportunities it poses for business and government. This study also identified the changes in driver industries since the original 2004 study, and more importantly, shed light on what occurred during the recession of 2008–2011.
The analysis used for identifying key driver industries is based on a diverse set of 12 variables that indicate past or present performance. The industry is then considered from two perspectives: competitiveness (including productivity, share of national industry output and relative average earnings) and export orientation and regional centrality (including output specialization, employment specialization and industry concentration). The boundaries of seven county-based economic regions have been retained from a similar Wisconsin study on manufacturing by the same research team in 2004. These regions are believed to best represent “economic” rather than political or geographic regions and are inclusive of all counties within the state.
Simply put, those industries identified in the study are economic drivers that have a high concentration within the state or region. They not only provide a competitive advantage, but also constitute high-growth derived from sales outside the region or state.
These driver industries form the nucleus of a linked group of companies that ultimately shape industry clusters. Many non-driver industries and their firms are critical components within industry clusters. That is to say, they are a geographic concentration of firms in the same industry that have close buy-sell relationships with other industries in the region, use common technologies or share a specialized labor pool. Because of this, the non-driver industries support the driver-industry firms by giving them a competitive advantage over the same industry in another region, state or country.
The bottom line is that this ability to keep the components of the driver/non-driver cycle moving and feeding into one another is the life force behind our ability to compete.
To know what our key driver industries are provides crucial direction for various public and private entities to improve the state’s overall performance. It defines our competitive edge and tells us where to focus our efforts. It’s important to note that these driver industries represent Wisconsin’s economic future, not only for the driver industries themselves, but for the industry clusters they depend upon.
This study has a direct influence on how the Wisconsin Economic Development Corporation (WEDC) envisions Wisconsin’s future economy. The data from this study will be used to develop investment strategies for the key economic drivers where there is a strong public-private partnership and regional leadership to help better leverage those strategies. In the end, this study is about discovery and using our innovative spirit to leverage key industries to create rapid, sustainable economic growth for the different regions and the state—and how that translates to a national and global scale.