Wisconsin Business Voice - Oct. 2017 by Wisconsin Manufacturers & Commerce (WMC)

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October 2017 Issue 26

Attracting Talent in a Tight Labor Market

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In This Issue...

WISCONSIN

October 2017 Issue 26

20 20 6

F RO M T H E P R E S I D E N T Workforce is Wisconsin's Mega Issue

States With A Medical Fee Schedule (States with a Medical Fee Schedule Shown Below in Red)

WA MT

ND MN

OR ID

VT WI

H E A LT H A N D H U M A N R E S O U R C E S P O L I CY Worker’s Compensation: Time for a Fee Schedule

M A N U FAC T U R I N G M O N T H Manufacturing is Strong in Wisconsin

10 AZ

NV CA

AR MS

TX LA

FL HI

S I N E S S VO I C E E XC L U S I V E 1 7 BU It’s Time for an America First Tax Overhaul STORY: WISCONSIN IS OPEN FOR WORKERS 2 0 COVER Attracting Talent in a Tight Labor Market

E W T E C H N O LO G Y 2 5 NAutomated Vehicles and the Wisconsin Proving Grounds

2 6

BUSINESS WORLD White Salmon and Generational Differences

N T E R N AT I O N A L 3 4 ILanguage Roadmap Key to Economic Opportunities

S P E C I A L F E AT U R E

I N N OVAT I V E ST RAT EG I E S A New Hiring Solution for Wisconsin

C O O L E ST T H I N G M A D E I N W I S C O N S I N 2017 Nominees

Foxconn: What it Means for Wisconsin

wisconsinbusinessvoice.org

October 2017

F RO M T H E E D I TO R

Have You Heard of Foxconn? By Nick Novak WMC Director of Communications and Marketing

ix months ago, you had probably never heard of Foxconn and likely did not know they are one of the largest technology companies in the world. This summer changed all of that. Foxconn Chairman Terry Gou flew to the White House for a “major jobs announcement.” The next day, the Milwaukee Art Museum featured 8K display panels and other futuristic technology for the signing of a memorandum of understanding between Wisconsin and Foxconn. Now we know a facility is going to be built in Mount Pleasant – in western Racine County – that will be the size of 11 Lambeau Fields. Foxconn will spend $10 billion to build their high-tech manufacturing plant and the surrounding facilities that will be critical to the company’s production. Additionally, it is expected that Foxconn’s supply chain will create $1.4 billion a year in economic activity, which is more than any other company in the state. There will be 13,000 jobs created by Foxconn, 10,000 construction jobs and 22,000 indirect or induced jobs because of the new facility. All of this is great news for Wisconsin, but more than a few business leaders are asking: Where are we going to find the people to fill 45,000 new jobs? It is a good question, but rest assured, Wisconsin is ready. This edition of Wisconsin Business Voice will detail what steps

WISCONSIN

President/Publisher Kurt R. Bauer

Managing Editor Nick Novak

Art Direction/Production Kyle Pankow

Contributing Writers Kurt R. Bauer, Nick Novak, Scott Manley, Chris Reader, Ray Allen, Lucas Vebber, Tony Sayegh, Jim Pugh, David Noyce, Jack Orton, Kari Hofer, Guido Podestá, Austin Ramirez, Lisa Fiore, Vicki Markussen

Advertising Sales Nick Novak, nnovak@wmc.org

WMC, other organizations and the state are taking to ensure we have a pipeline of talented workers. On page six, WMC President/CEO Kurt R. Bauer discusses the Future Wisconsin Project and a new video aimed at bringing people back to our state. Department of Workforce Development Secretary Ray Allen writes about Manufacturing Month on page 13 and highlights numerous worker training programs. Our cover article talks about Wisconsin’s perception and what the Wisconsin Economic Development Corporation is doing to attract talent. And don’t miss the special feature on page 36 that directly talks about what Foxconn means for Wisconsin. We understand the workforce challenges and we are ready to take them on. n

Wisconsin Business Voice is published quarterly by Wisconsin Manufacturers & Commerce. WMC is Wisconsin’s chamber of commerce, manufacturers’ association, and safety council representing businesses of all sizes and from every sector of the economy. WMC 501 E. Washington Avenue Madison, WI 53703 tel.: 608.258.3400 Follow us:

WisconsinMC Wisconsin Manufacturers and Commerce WMC501

Looking to advertise in WI Business Voice? Contact Nick at nnovak@wmc.org. @WisconsinMC

October 2017

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F RO M T H E P R E S I D E N T

Workforce Is Wisconsin’s Mega Issue By Kurt R. Bauer

t was a good summer for Wisconsin’s economy. In about a 10-day period in late July and early August, Wisconsin bested several other states in a fierce competition to convince Foxconn to build a massive high tech manufacturing facility here. Shortly after that announcement the federal Department of Labor released data showing Wisconsin led the Midwest in GDP growth in the first quarter of the year and Moody’s upgraded our bond rating for the first time since the 1970s. Those are all positive developments proving that hard-fought reforms to improve Wisconsin’s business climate have the state clearly headed in the right direction in the eyes of all but the most stubborn deniers. But in my opinion the most important metric on how a state is doing economically is whether people can find work and on that score the news is very good. In Wisconsin today, anyone who has the initiative and is drug free can find not just a job, but a career, which I define as a position with a good wage, benefits and an

October 2017

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opportunity for merit advancement. In fact, Wisconsin has more jobs than we have people to fill them. Demographers say that won’t change anytime soon, which is why I call the state’s labor shortage a mega issue that threat-

In Wisconsin today, anyone who has the initiative and is drug free can find not just a job, but a career. ens long-term prosperity more than any other. Workers are the foundation of any state’s tax base and not being able to find replacements for retiring Baby Boomers will erode that base and stress important investments in K-12 education, the UW System, transportation, Medicaid, etc. Ironically, Foxconn’s expected 10,000 construction jobs, 13,000 direct jobs and at least 22,000 indirect jobs can help solve the workforce problem. Foxconn is Wisconsin’s mega opportunity. The announcement that the Taiwanbased tech giant selected Wisconsin

was broadcast live on most cable channels reaching not just a national, but a global audience. It sent a message far and wide that Wisconsin can compete in the big leagues with much larger states with deeper economic development pockets. It is also changing perceptions about the kinds of jobs Wisconsin has to offer. Several years ago, the WMC Foundation conducted a survey to find out how Americans view Wisconsin. Perhaps not surprisingly, the survey found that most out-of-staters believe that agricultural-related jobs dominate our economy. Foxconn can help change that misperception to one that more accurately reflects the diverse job opportunities that exist statewide. Changing perceptions about Wisconsin doesn’t necessarily require a grandiose branding campaign, but I recommend using the Foxconn announcement as the catalyst to remove “America’s Dairyland” from our license plates in favor of something more contemporary. You can’t go wrong with using our simple, but impactful state

We need to focus on creating a “Foxconn North” project that draws people to the central and northern parts of the state. motto. To me, “Forward” connotes resolve, indomitability and progress; not a bad image to project to the rest of the world. WMC has done our part to market Wisconsin’s many career and quality of life advantages. At last year’s Future Wisconsin Summit, we premiered a video intended to highlight Wisconsin as a great place to both start your career and a business. At this year’s Summit, which will be held November 29 in Madison, we will debut another video featuring Wisconsin as a great place to raise a family. The Wisconsin Economic Development Corporation will also

unveil their marketing plan targeting young professionals in Chicagoland (see page 20 for more information). Wisconsin is the best kept secret in the Midwest and Foxconn can continue to help us get the secret out in order to attract more people looking for economic opportunity. But despite the fact that our labor participation rate is one of the best in the nation, there are still too many working age people not in the workforce. Hopefully, Foxconn can help people from communities hit hard by the loss of manufacturing jobs to Asia decades ago find a pathway to the middle class. Ironically, it is an Asian

company offering that opportunity. Finally, we need to focus on creating a “Foxconn North” project that draws people to the central and northern parts of the state the way Foxconn will attract people to southeastern Wisconsin. Investing in broadband access is one way to do that. Mining is another, which is why WMC, along with a large coalition of other business groups, is asking the legislature to lift the moratorium on nonferrous mining. Doing so could potentially open the state to billions of dollars of investment that could create hundreds and even thousands of middle class supporting jobs. n

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October 2017

G OV E R N M E N T R E L AT I O N S

Competitiveness is not a Complicated Formula By Scott Manley WMC Senior Vice President of Government Relations

here are many facets to WMC’s lobbying agenda. One day we are advocating for additional technical education opportunities for high school kids to address the skilled worker shortage and the next day we are advocating for employment law changes to reduce complexity for employers. When you represent nearly 4,000 small, medium and large businesses in every sector of the economy, you necessarily tackle a very broad array of issues impacting employers. Yet over the years, something has remained constant in our advocacy. We have consistently held that the recipe for economic success is the same for any business, regardless of size and regardless of economic sector. What is the magic formula? We have consistently maintained that if you get three things right, economic investment and prosperity will follow. Those three things are tax reform, regulatory reform and legal reform. WMC has spent more time and effort focusing on these three things than any organization in Wisconsin. It shouldn’t be surprising that taxes, regulation and litigation sit atop the list of policies that can make or break economic competitiveness—all three are key factors in the cost structure for every business. Whether you are a foundry, a bank, a software developer or biomedical engineering firm, if your tax, regulatory and legal costs are too high, you will not be competitive. It’s that simple.

October 2017

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Yet WMC is often criticized for spending so much effort to reduce tax, regulation and litigation costs and thereby make doing business more affordable. Our critics say we should instead focus on the “new economy” or the “knowledge economy” or the “green economy” or the “tech economy” or whatever the trendy new buzzword is among the chattering class of “experts” and academics who have never actually run a successful business. No matter the economic sector, if you don’t have a competitive cost structure, you don’t have a competitive business. Reducing the cost structure for taxes, regulation and litigation is inherently good for all businesses—including

those in the so-called “new,” “next” or “knowledge” economies. The proof lies in Foxconn. Wisconsin landed the Foxconn investment in large part due to the skill and expertise of Governor Scott Walker and the leadership team in his administration who negotiated with the company. However, Wisconsin was given serious consideration in the first place because of the reforms to tax, regulation and litigation that began six years ago—and continue today. In the area of taxation, the last six years has seen Wisconsin cut income taxes across the board, freeze property taxes, virtually eliminate the income tax on manufacturing, eliminate the

state property tax, substantially reduce the technical college property tax, eliminate the alternative minimum tax and significantly reduce the personal property tax. On the regulatory front, we enacted Right to Work, brought huge reforms to our unemployment benefit laws, significantly curtailed state agency rule making authority and prohibited agencies from enacting new regulations costing $10 million or more unless the legislature votes to approve them. In the area of legal reform, we reversed a terrible Supreme Court decision that made manufacturers liable for harm caused by products they didn’t make, placed caps on punitive damages, created standards for expert witnesses, enacted product liability reforms and passed other measures that enhance the fairness and transparency of our legal system.

These tax, regulatory and legal reforms have created an environment where businesses want to invest. They helped provide the competitive cost structure that caused Foxconn, the ninth-largest technology company in the world, to come to Wisconsin and produce the only LCD display panels in the world outside of Asia. A business like Foxconn doesn’t decide to invest $10 billion and employ 13,000 workers here unless our overall business climate is competitive. There are certainly other reasons Foxconn chose Wisconsin, including our manufacturing heritage, skilled workforce and educational institutions. Those factors should not be minimized. However, we never even get the opportunity to showcase those assets if we don’t have the right tax, regulatory and legal climate that causes employers to consider investing in Wisconsin in the

first place. Foxconn’s historic investment in Wisconsin is only the beginning. Creating an ecosystem for 8K-5G technology will attract investment to our state, and the multiplier jobs that go along with it, which exceeds anything we have ever seen before in our state. We believe the project will serve as a magnet to attract talent to our state and reverse our problem with “brain drain,” much in the same way workers flocked from all over the country to the economic opportunity resulting from the oil boom in North Dakota. None of this tremendous investment will be the result of adopting boutique, fad or niche development policies. Rather, our success will come from sticking to the fundamentals—and aggressively advocating for tax, regulatory and legal reforms. It’s a proven plan with a proven track record. n Follow Scott on Twitter @ManleyWMC

wisconsinbusinessvoice.org

October 2017

Wisconsin employers and employees have worked together to reduce the number of workplace injuries in our state. Since 1994, we’ve witnessed a dramatic 58% drop in annual injuries – from 219,975 in 1994 to 93,228 in 2014.

HUMAN RESOURCES

Worker’s Compensation: Time for a Fee Schedule By Chris Reader WMC Director of Health and Human Resources Policy

legislative battle is brewing in Madison to correct runaway prices for worker’s compensation medical bills. This is an important issue for employers in Wisconsin of every size and from every industry, from trucking and manufacturing to retailers and municipalities. Despite many good things happening in the worker’s compensation system in Wisconsin, including low litigation rates, reduced number and severity of injuries, top-notch healthcare quality and quick return to work for injured workers, medical billing is out of control. In fact, according to national experts that study worker’s compensation throughout the country, costs in WI were 60 percent above average for injuries that required seven or more days off of work in 2014/15, the latest years studied, and 47 percent above average for all injuries, including those with less than seven days lost time. If you take a three year average, medical costs in Wisconsin remained the highest in the nation at 39 percent above average. The overall amount spent on worker’s compensation medical bills in Wisconsin has more than doubled since 1994, from $314 million to $648 million in 2014. It’s not just across state lines - the difference is also apparent when comparing worker’s compensation to group health pricing. Identical procedures cost much more if paid through worker’s compensation versus group

10 October 2017

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health. Consider this example; if two individuals are outside shoveling the sidewalk after a blizzard, right next to each other, one in front of his house and one in front of a neighboring business, and they both suffer the same knee injury, see the same doctor and

The overall amount spent on worker’s compensation medical bills in Wisconsin has more than doubled since 1994. have the same knee arthroscopy, the arthroscopy on the knee that is covered by worker’s compensation will cost on average 237 percent more. That variance is one of the highest in the nation. At the same time that medical prices have gone up, Wisconsin employers and their workforces have come together to dramatically reduce the number of workplace injuries in our state. Due to investments in safety by employers, safety training and a workforce that aims to be safe on the job, workplace injuries have fallen dramatically over the last 20 years, from 219,975 annual injuries in 1994 to 93,229 injuries in 2014. If you combine that decrease with the increasing prices, we have witnessed a per claim price increase since 1994 of more than 450 percent. While the primary goal of safety investments and training is to keep workers safe, a secondary effect of

Despite the reduction in injuries, medical costs for worker’s compensation claims continue to skyrocket. Medical bills have gone up 450% per claim over the same time period. While employers should have realized savings from the reduction in injuries that could have been reinvested into wages & benefits, worker training, R&D, capital improvements, etc., any savings have instead been shifted to skyrocketing medical costs.

According to the Workers Compensation Research Institute (WCRI), an independent, not-for-profit research organization out of Massachusetts, Wisconsin is routinely one of the most expensive states for worker’s compensation medical costs.

47% 60%

It in ar di 2

higher for all claims* higher for major injuries*

*According to WCRI. Average Wisconsin medical price per claim with 7 days or more of lost time were 60% higher than median in 2014/15. Average Wisconsin medical payment per claim on all claims, including those with less than 7 days lost time, was 47% higher than median in 2014/15.

the dramatic reduction in injuries should be cost savings for employers F on their worker’s compensation costs, Chris Reader, WMC Director o freeing money for things like wage 501 East Washington Avenue, Madison, W and benefit increases, worker training, new hires, capital investments, and research and development. This safety dividend has not occurred due to sharp climb in medical costs over the same time period. Whether a business is self-insured or fully insured for worker’s compensation, this is an important issue. Self-insured employers understand the costs firsthand as they get the medical bill every time one of their workers is injured. For employers that carry worker’s compensation insurance and may not see individual bills, their insurance premium

states and implement this common sense reform. You might be wondering, even if you agree that costs are too high, why the state should be involved. Worker’s compensation is a state-mandated social program that Wisconsin implemented in 1911, the first state to do so, to ensure injured workers get treated and, if possible, back on the job quickly, without needing to sue employers. The tradeoff for employers not getting sued for workplace injuries is that they are almost universally required to take part. Insurance rates are set by state government. State government establishes dispute procedures and governs

rates should be dramatically less today than they are, but the skyrocketing health care costs get baked into insurance premiums year over year, keeping rates higher than they would otherwise be. Even in 2018, when rates are falling significantly due to a continued reduction in the number and severity of injuries, rates are still propped up higher than they should be because of increasing medical costs. Fortunately there is a tried and tested solution for Wisconsin to implement. Forty-four states have implemented a medical fee schedule to control worker’s compensation medical costs. It’s time for Wisconsin to join those

States With A Medical Fee Schedule (States with a Medical Fee Schedule Shown Below in Red)

WA MT

ND MN

OR ID

VT WI

SD WY

PA IL

MI IA

NE CO

NJ WV

AR MS

TX LA

how much injured workers receive in weekly benefits. The only aspect not set by state government is the cost of medical treatment employers are required to pay. And employers or their insurance companies must pay regardless of what doctor the injured worker chooses for treatment. The bottom line is the state is involved in every aspect of worker’s compensation now, except for the medical prices. Lawmakers are currently being asked to support a proposal put before them by the Worker’s Compensation Advisory Council (WCAC) that includes a fee schedule that would bring worker’s compensation pricing in line with group health rates, plus a small 2.5 percent amount to cover any administrative costs providers might encounter during the course of a worker’s compensation claim. The WCAC is a council compromised of five management representatives and five labor representatives, and every two years it recommends changes to the laws governing worker’s compensation. In full disclosure, I serve on the council as a management representative. Because of the diverse membership on the council, which includes both WMC and the AFL-CIO, proposals from it are generally regarded by lawmakers as good reforms and adopted without much fanfare. This year, however, we expect medical providers to oppose the council bill in an effort to protect the high prices they charge for worker’s compensation claims. An employer coalition has also formed and is currently working to convince lawmakers to pass the fee schedule bill into law. If you agree that it’s time Wisconsin joins with 44 states and puts in place common sense controls on worker’s compensation medical bills, reach out to your state lawmaker today and voice your support. If enough employers voice their support, Wisconsin will finally join almost every other state and bring down runaway worker’s compensation pricing. n

Follow Chris on Twitter @ReaderWMC wisconsinbusinessvoice.org

October 2017 11

Future Wisconsin Summit 2017 November 29, 2017

Monona Terrace Community & Convention Center, Madison

Governor Scott Walker (invited)

Join the WMC Foundation for the 4th Annual Future Wisconsin Summit. This annual Summit – a collaborative effort between the business community, public policymakers, educational institutions, and local chambers of commerce – is held to forge consensus on policy changes and strategies for our state. This year’s event features Blake Moret, President and Chief Executive Officer, Rockwell Automation; Governor Scott Walker (invited); Foxconn Discussion; Workforce Discussion; and a Marketing/Branding Presentation from the Wisconsin Economic Development Corporation.

72 Chambers of Commerce and NEWaukee

PROGRAM SPONSORS

Enbridge Energy Co., Inc.

www.futurewi.org

Blake Moret Rockwell Automation

M A N U FAC T U R I N G M O N T H

Manufacturing is Strong in Wisconsin By Secretary Ray Allen Wisconsin Department of Workforce Development

ov. Scott Walker proclaimed the month of October as Manufacturing Month in Wisconsin to showcase the impact that manufacturing has on our state's economy. The strength of Wisconsin's manufacturing industry and the strength of Wisconsin's economy are perpetually linked, giving Wisconsinites plenty of reason to celebrate, including: • Manufacturing accounts for 18 percent of Wisconsin's gross domestic product. • Wisconsin's manufacturing industry employs more than 461,000 Wisconsinites. • Manufacturing contributed over $56 billion to Wisconsin’s economic growth in 2016. • Wisconsin manufacturing workers earn an average of $55,348 per year, 20% more than the average of $45,954 per year for all private-sector workers. This year, we have even more reasons to celebrate our manufacturing industry's past, present and future. Due to a variety of factors including the strength of Wisconsin's workforce, our top 10 business climate as well as our first-class education system, global manufacturers such as Foxconn and Haribo have announced their decision to locate in Wisconsin, bringing thousands of manufacturing jobs to the state. Foxconn, in particular, represents the largest economic development project in Wisconsin, bringing high-tech manufacturing and a technology ecosystem to Wisconsin that will create up to

13,000 direct jobs and has the potential to transform our economy, workforce and education system. In addition, the project is estimated to create 10,000 construction jobs and 22,000 additional

We have even more reasons to celebrate our manufacturing industry's past, present and future. indirect or induced jobs from companies that will directly supply Foxconn as well as secondary industries such as retail, food service, and more. And, thanks to Gov. Walker's vision and leadership, Wisconsin is ready to bring the next generation of advanced manufacturing to the United States. Opportunities such as these are the reason Gov. Walker's administration has made workforce development a top priority. Over the past four years, Gov. Walker and the Legislature have invest-

ed over $362 million in state funding on programs such as Youth and Registered Apprenticeship and the Wisconsin Fast Forward worker training grant program. DWD also recently launched WisConnect.com, an online tool that connects college students with Wisconsin employers that offer internships. These initiatives help students and workers develop high-demand job skills that employers need. With strong partnerships and innovative approaches including Wisconsin technical colleges, universities, and manufacturing-industry partners, DWD will work to maintain and strengthen the talent pipeline for current and future manufacturing employers across the state. Wisconsin Manufacturers & Commerce (WMC) has been a leader in drawing regional and national attention to Wisconsin's manufacturing industry, not just during Manufacturing Month, but throughout the year. This year, during Manufacturing Month, DWD, WMC, Wisconsin Economic Development Corporation, the Wisconsin Technical College System and other partners engaged in various activities to promote Wisconsin's manufacturing industry. We encourage all Wisconsin manufacturers to learn more about what you can do to raise awareness of opportunities in the manufacturing industry by visiting wimanufacturingmonth.org and dwd.wisconsin.gov. n

wisconsinbusinessvoice.org

October 2017 13

E N V I RO N M E N TA L A N D E N E RG Y P O L I CY

Wisconsin's Resources Put Us On The Map By Lucas Vebber WMC Director of Environmental & Energy Policy and General Counsel

n Wisconsin we love our outdoors. Our state parks are a draw that nowhere else can match. Our natural beauty contributes to our strong tourism industry and Wisconsin’s high quality of life. As we continue to see investment flow into Wisconsin, it is also clear that our state’s natural resources also give us a competitive advantage over other states and other countries when it comes to economic development. When we combine our state’s strong business climate, skilled workforce and access to critical resources, Wisconsin presents an opportunity for investment that no other state can match. From abundant water supplies to some of the largest untapped ore deposits in the world, Wisconsin has a lot to offer. With the right regulatory framework we can grow our economy while continuing to improve our environment for future generations. We need to look no further than the proposed Foxconn project to see this in action. Wisconsin is located on two of the largest freshwater lakes in the world. Fresh water is a critical component of the advanced manufacturing process being proposed in southeast Wisconsin—and fresh water is something Wisconsin has nearly abundant access to. In the legislative changes to attract this generational investment, some modest changes were made to our state’s environmental permitting laws. Within the proposed electronics and information technology manufacturing zone, Wisconsin-specific red tape was

14 October 2017

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cut, existing carve outs were expanded and minor changes were made to our state’s wetland permitting laws. Importantly, the legislation maintained all existing standards for water quality, air quality and solid waste. It also required a 2:1 mitigation for any impacted wetlands—significantly higher than what’s required under state law. These changes ensure our environment will continue

Maintaining a balance that allows our resources to be utilized while protecting them for future generations is critical. to improve while we reap the benefits of this once-in-a-generation economic development opportunity. Anti-development activists have been stepping up their rhetoric to attack projects like the proposed Foxconn devel-

opment. Using over-the-top fear tactics and misleading statements, these activists are trying to drive public opposition to business development. The truth is that Foxconn will have to meet the same stringent environmental standards as every other business in Wisconsin. The investment made for this project will be felt around the state for years and years to come. Maintaining a balance that allows our resources to be utilized while protecting them for future generations is critical to economic growth and development. It’s important to note that Wisconsin manufacturers have been working for generations to grow our economy and protect our environment. As some of the most heavily regulated business entities in the world, Wisconsin manufacturers have literally spent billions of dollars on pollution abatement and regulatory compliance. Every day manufacturers are innovating to protect our state’s natural beauty while growing our manufacturing-dependent economy. As Wisconsin continues to grow our economy and attract investment, we can continue to do so in a way that protects our environment while opening our doors to economic development. The two are not mutually exclusive. Through common sense regulatory policy we can make sure future generations enjoy the same natural beauty that we do today, while leaving them with an even better economy. n

Follow Lucas on Twitter @VebberWMC

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BU S I N E S S VO I C E E XC L U S I V E

It’s Time for an America First Tax Overhaul By Tony Sayegh U.S. Treasury Department Assistant Secretary for Public Affairs

merica’s tax system has not been overhauled in 31 years, and it is placing U.S. taxpayers, businesses and workers at a huge disadvantage. This fall, Congress has a once-in-a-generation opportunity to pass a comprehensive reform plan that puts America first and positions our businesses and workers to win again. This is President Trump’s top legislative priority, and he is working with both parties to get it done. It is time for lawmakers to put partisanship aside and come together to get our economy and wages growing at a much faster rate. Real reform that cuts taxes and levels the playing field for American workers will bring jobs back from other countries, and lay the groundwork for companies to grow and hire here as they adapt to the economy of the future. Hardworking Americans deserve to keep more of their precious time and money. It should not take 241 pages of instructions and a high-priced accountant to file your taxes. President Trump is committed to a plan that will lower the tax burden for middle-income families, and simplify the system so that 95% of Americans can fill out their tax returns on a single sheet of paper. Middle-income families deserve a pay raise and a tax cut, and that is what the President’s plan will accomplish. We plan to double the standard deduction so that a typical family will not pay any federal income taxes on the first $24,000 of their income, and we will get rid of special-interest loopholes that only benefit those who can afford Washington lobbyists.

At the same time, we must stop the flow of cash and capital out of our country through nonsensical policies that penalize our most talented entrepreneurs with sky-high business tax rates of 35 percent or more. While countries in Europe and Asia have adapted and lowered rates to compete in the global economy, America’s tax code has been largely stagnant since the mid-1980s. President Trump has set his sights on a 15 percent business tax rate, which would mark a sharp reversal of this job killing narrative. Lower rates will attract investment and spur the growth that our businesses need to compete and succeed in an inter-connected global economy. This will especially benefit small businesses, which fuel much of our job growth. Small towns across the country have unfortunately paid the price for Washington’s decades of failure. Local manufacturers have been forced to shut down or move factories overseas in order to stay alive. Instead of giving

American companies a leg up against global competitors, our politicians have let them down time and again—and American communities have suffered. We need to incentivize companies to bring their jobs and money back to the U.S. instead of penalizing them with punishing tax rates and compliance costs. President Trump’s plan will take us from the “Off Shoring Model” to the “American Model,” and bring back trillions of dollars and millions of jobs parked overseas. This will spur growth that will revitalize our cities and unleash the work ethic and ingenuity of America’s greatest assets—our people. Wisconsin saw a preview of how transformative a tax system that supports businesses and their employees can be when technology manufacturer Foxconn announced it would be opening a $10 billion factory in the state, creating thousands of jobs. We now have an opportunity at the federal level to create an environment that attracts businesses and helps to get our manufacturing sector roaring again. It will not be easy to pass such a bold package of reforms, and we know that special interest groups will fight hard to save their carve outs and tax breaks. It is time to take on the status quo and seize this opportunity to restore prosperity. Congress must break through these barriers to pass an America First tax plan that the President can sign to restore our economic dominance and once again make our country the best place in the world to hire, invest and grow. n

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October 2017 17

M A N U FAC T U R I N G S P OT L I G H T

These are Not Your Father’s Manufacturing Jobs A s Department of Workforce Development Secretary Ray Allen highlighted earlier in this edition (page 13) of Wisconsin Business Voice, Gov. Scott Walker proclaimed October as Manufacturing Month. This is a great way for people all around the state to find out about all the cool things made in Wisconsin. Speaking of cool things made in our great state, make sure to check out page 40 to see all the nominees for Coolest Thing Made in Wisconsin. Last year’s contest had about 20,000 votes total, and this year Wisconsin Manufacturers & Commerce (WMC) added another zero! That’s right, about 200,000 votes helped determine the Coolest Thing Made in Wisconsin. In addition to the Coolest Thing contest, WMC and the Wisconsin Safety Council (WSC) traveled the state for five stop on the State of Wisconsin Manufacturing Tour, including one stop at Miller Park and another that featured

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“Dirty Jobs” host Mike Rowe in Beloit. Rowe discussed the popular TV show and said he was surprised that success does not always look like what you think it does. “[Dirty Jobs] didn't feature people who were desperate or victims, but people who mastered skills in demand and used it to prosper,” he said during a discussion with WMC President/CEO Kurt. R. Bauer. This was especially true for Les Swanson from Wisconsin. Rowe joined him for a day’s work cleaning and servicing septic tanks. Swanson left a career in psychiatry because in his own words, “he was tired of dealing with other people’s crap.” “Les Swanson from Wisconsin” as Rowe would say numerous times at the dinner event in Beloit looked at where everyone else was going at the time and he went in the opposite direction. He followed the opportunity and found a way to become passionate about it.

This led him to running a very successful business. This is a theme that Rowe discussed throughout the night as he encouraged high school students in attendance to develop skills that can prepare them for any job—from good communication and being on time to dressing appropriately and a willingness to show up early and work late. His overall pitch for the evening was that there is tremendous opportunity in the skilled trades—over six million jobs that are going unfilled because of the skills gap. He told the audience it is time to end the practice of loaning money we don’t have to students who are going to school for jobs that no longer exist. While Rowe said there is nothing wrong with pursuing a four-year degree, the same should be said about vocational and technical education. Being a welder, a plumber or any other skilled trade is something that parents

and educators should advocate just as much as a white-collar office job, he remarked. The event, hosted by the Hendricks Family Foundation and WMC, also featured ABC Supply cofounder Diane Hendricks and Gov. Walker. Both highlighted the importance of the skilled trades and embraced the opportunity of manufacturing jobs. Gov. Walker presented Bauer with the signed proclamation during the unofficial kick-off event for Manufacturing Month. Following in the footsteps of Rowe, Walker and Hendricks, WMC launched a new video series in October that focused on the tremendous opportunity available in manufacturing. The four videos focus on different themes: Vocational Education, High-Tech Manufacturing, Women in Manufacturing and the Coolest Thing Made in Wisconsin. The first video showcased Wisconsin’s premiere technical colleges and featured two students are excited about

the career path they chose. “There is nothing like building something with your own hands,” said Samuel Petterson, and student at Gateway Technical College. “Once you have the finished product in your hands— something you can use and show to everyone that I made this with my own hands—it is a pretty cool feeling.” The students featured in the video are not preparing for your father’s manufacturing jobs, however. Manufacturing today is high-tech, high-skill and highpaying. That is why the second video of

the series focuses on many of the advancements being made in the industry. At the John Deer Horicon Works facility—featured in the second video—there are literally robots that drive around the factory floor after being taught the layout. They go from stop to stop allowing for greater efficiency when building a John Deere Gator. And it isn’t a man’s world anymore when it comes to manufacturing. Just ask 18-year-old Ella Johnson who recently completed her welding certificate from Waukesha County Technical College at the same time she was finishing high school. Johnson—the star of the third video in the series—may not be the stereotypical welder that you think of, but she is extremely passionate about the opportunities she has in manufacturing. The video series, which also highlights some of the Coolest Things Made in Wisconsin, is available at WIManufacturingMonth.org. n

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wisconsinbusinessvoice.org

October 2017 19

C OV E R STO RY

Attracting Talent in a Tight Labor Market By Nick Novak WMC Director of Communications and Marketing

t was November 2, 2010 and a packed room of a few hundred people stared at a sign that measured no more than three feet wide and maybe 10 inches tall. The sign—with a navy background and white lettering—was attached to a hotel podium with blue painters tape. It was barely a site to see, but it carried a strong message. “Wisconsin is Open for Business” While the sign did little to turn around Wisconsin’s future, the man standing behind it is sometimes referred to as the most consequen-

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tial governor Wisconsin has had in more than a century. That governor, of course, is Scott Walker. When Walker took the helm of Wisconsin, he made it known—even from that very first moment as governor-elect—that the state was going to head in a new direction. Walker quickly went to work cutting taxes, reforming government and making sure employers knew he was on their side. Fast forward to seven years later, and Wisconsin may need a new slogan. Yes, the state is still very much

open for business, but now Wisconsin needs workers. Wisconsin Manufacturers & Commerce (WMC) President & CEO Kurt Bauer has taken to calling the workforce shortage a “mega issue” for the state. He is right. But don’t worry, there is good news.

Wisconsin’s Reality “I am a recovering flat lander,” Cliff Sanderson bluntly explains when talking about the great things Wisconsin can offer. Sanderson, the Vice Presi-

dent of Human Resources at Mayville Engineering Company, Inc. (MEC), brings up a variety of factors when talking about why he chose to relocate to Wisconsin. “I spent most weekends over the past 20 years coming to a cabin to enjoy this beautiful state, and really when I had the opportunity to work at MEC presented to me, it was a no-brainer,” he says. In addition to great schools, low crime rates and an overall high quality of life, Cliff is quick to point out some important financial reasons for becoming a Wisconsinite. He details a lower cost of living in Wisconsin compared to his home north of Chicago, and—almost proudly— talks about his property tax bill, which is 60 percent lower than it was for his similarly valued home in Lake County, Illinois. The excitement about what Wisconsin has to offer is felt in seemingly all parts of the state. Carl Rick, a Leadership Development Specialist and third-generation owner at Kwik Trip, beams will pride when asked about his home state. “It is a wonderful place to live,” he says with a spirited tone in his voice. “I had the privilege to grow up here on the western side of the state, and I left for a year to go to school. But, I very quickly came back.”

Wisconsin’s Perception While Wisconsin’s residents are well aware of the many amenities the state has to offer, very few others are. In fact, separate research conducted by WMC and the Wisconsin Economic Development Corporation (WEDC) found similar results about the perception of Wisconsin from people who live in other states. It is cold. There are only farms. The people drink a lot of beer. Unfortunately for Wisconsin, perception is reality and the demographics back it up. The state’s population is simply not growing fast enough to

keep up with the demands of a bustling economy. “We just flat out have a shortage of people,” Scott Mayer points out. As chariman & CEO of QPS Employment Group, Mayer knows what it takes to find workers. But, finding them is not as easy as it once was. “If we had 5,000 people today, we could place them without any question at all,” he declares. To change this fact, Mayer and others think a targeted marketing campaign is required to change the perception of the state. “We simply need to tell this great Wisconsin story,” Rick says. “We are more than cheese curds, beer and the Packers.”

Changing the Perception Wisconsin has spent years honing its message to businesses on why they should invest and expand in the state. For those paying attention, they have become rather good at it. For proof, look no further than the $10 billion investment Foxconn Technology Group will be making in the state. Bob Kamphuis, Chairman, President & CEO of MEC, thinks this type of mes-

saging could be used to attract talent to Wisconsin, not just new employers. “We are envious of the Pure Michigan campaign that the state has going on. Grand Rapids continues to grow as the state promotes live, work and play themes and that effort has been successful in attracting people from out of the state,” he says knowingly. MEC has

The state’s population is simply not growing fast enough to keep up with the demands of a bustling economy. multiple facilities around the country, including Grand Rapids, Michigan. Kelly Lietz, Vice President of Marketing & Communications at WEDC, hears the pleas of the business community and says his team is ready to step up to the plate. In the first quarter of 2018, WEDC will be launching a marketing campaign in the Chicago area aimed at highlighting all the great things Wisconsin has to offer. In total, WEDC will shift $1 million that was previously used for attracting businesses to Wisconsin

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October 2017 21

The Wisconsin Economic Development Corporation (WEDC) plans to begin a targeted advertising campaign to attract talent workers to Wisconsin. WEDC tested its messaging, and below are some highlights from Chicago residents: “Never thought this state was attractive like this, really thinking about moving there. There are a lot of things to do/site see. Seem like a family orientated place.” “It looks like a state where you can live freely, and spend more time with friends and to have fun.” “I didn't know these facts about Wisconsin, I always thought it was mostly farms.”

Not surprisingly, when asked what top images of Wisconsin come to mind, the general population outside our state responded:

COLD WINTER

CHEESE BEAUTIFUL LAKES

PACKERS

DAIRY FARMS

GREAT OUTDOORS NATURAL BEAUTY

and instead focus on attracting talent to the state. This new advertising is a part of WEDC’s Think–Make–Happen campaign that was announced late last year at the WMC Foundation’s Future Wisconsin Summit. “We compare and contrast the quality of life in Chicago to that in Wisconsin,” Lietz explains. “From the time spent commuting and what things cost to the amount of free time and recreational activities, we are doing a positive comparison of what Wisconsin has to offer versus the Chicago market, where most of the advertising will hit.” The campaign will include digital and out-of-home ads that direct potential Wisconsinites to a freshly designed website that highlights all of Wisconsin’s great features. The site will

WEDC will shift $1 million that was previously used for attracting businesses to Wisconsin and instead focus on attracting talent to the state. showcase job opportunities, housing possibilities and a plethora of activities for people to experience outside of work. “We are not just putting these ads out there and hoping people will change their mind about what they think about Wisconsin,” Lietz continues. “Once we drive people to that website, we are looking to hook them. The way we are going to measure the success of this campaign is through the actions they take once they are there.”

Making Work Attractive

The likelihood that millennials from surrounding states would consider moving to Wisconsin was as high as

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49% .

It is not just about attracting workers to Wisconsin, though. Ask any employer in the state how we solve the worker shortage, and the response will have numerous strategies. They will tell you, “retention is key,” “we need to better market the state,” “we need to train the

C OV E R STO RY

WEDC's Tricia Braun announcing Think-Make-Happen at the 2016 Future Wisconsin Summit.

people already here,” and “students need to be taught success doesn’t always mean a four-year degree.” An entire library could be filled with what has been written about the things companies are doing attract workers in a tight labor market. But, something heard across the state from business leaders that gets less attention is that work needs to be more attractive. Wisconsin is currently at full employment—meaning every person that wants a job, has a job. If you can be to work on time, are drug free and have a willingness to learn, Wisconsin is full of opportunity. MEC’s Sanderson argues that we need to find a way for the people who are not in the labor market—but could be—to choose a career over government benefits. The benefits are keeping people from even looking for employment. “One of the issues that we see with the folks who are unwilling to work is

with the way state benefits are handled,” he explains. “If I am not working, I’m getting subsidized rent, health insurance, food stamps and other benefits to hold me over until I get a new job. The problem is that these benefits are an all or nothing proposition.” He says it is sometimes better to stay unemployed. “If I have to give up 100 percent of my benefits when I take a job—which in the short term is going to be a negative financial hit—that is going to be a huge risk,” according to Sanderson. “I think the enthusiasm has been scared out of them.” By making these safety nets more of a sliding scale, he thinks it would make work more attractive. Instead of losing benefits because someone takes a job, the government should gradually reduce the benefits as more income is earned. Otherwise, Sanderson says, the government is actually discouraging work.

Working in Wisconsin The Midwest, and Wisconsin in particular, have always been a little different than other parts of the country. The same is true when it comes to work. Most job listings have an assortment of requirements, a description of duties and maybe preferred education. These are still included in Wisconsin, but there is something else, too. “We need kind people,” Kwik Trip’s Rick says. “We need people that live that mission statement that we are going to treat others the way we want to be treated, and look for ways to make a difference in someone’s life.” At the heart of it, that is Wisconsin. It is about making a difference. It is about going home at night to your family knowing you don’t just work for a paycheck. Wisconsin has a great story to tell, now we just need to tell it. n

wisconsinbusinessvoice.org

October 2017 23

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N E W T E C H N O LO G Y

Automated Vehicles and the Wisconsin Proving Grounds By David Noyce, PhD, PE, F.ASCE Dr. Arthur F. Hawnn Professor and Chair, UW-Madison

utomated vehicles (AVs) are reshaping not only the auto industry, but safety and mobility worldwide. Not since the advent of the automobile has something been as disruptive in transportation, but we are still in the midst of a long transition. While automated features are increasingly available, the issues are complex and implications widespread, spanning advanced technologies, policy and regulation, human factors and much more. Wisconsin is positioned to play a key role in guiding policy and technology development, while bringing AV related jobs and economic growth to our region. In May 2017 Gov. Walker issued an executive order to create a committee on connected and automated vehicles (CV/AV), with the mission to coordinate among agencies and identify “laws or rules that impede the testing and deployment of” CV/AVs. Earlier in 2017, the U.S. Department of Transportation designated Wisconsin as one of ten official Automated Vehicle Proving Grounds. Building on prior work, Wisconsin intends to remain at the forefront of these transformative technologies, and the R&D underway contributes to revolutionizing how the world uses transportation. The Wisconsin AV Proving Grounds mission is to provide a path to public road evaluation by contributing to the safe and rapid advancement of

Wisconsin Automated Vehicle Proving Grounds

automated vehicle development and deployment, and providing a full suite of test environments, coupled with research, open data and stakeholder communication. In addition to UWMadison, the team includes private test tracks and industry partners, bringing diverse technical expertise in evaluation and assessment; mechanical, electrical, systems and transportation engineering; robotics, hardware, computer science and big data; sensing systems and high resolution basemapping; and simulation and modeling. Safety is a chief motivator, with rising traffic fatalities in Wisconsin and nationally. Because over 90 percent of crashes are attributable to human error and inattention, AVs have enormous potential to save lives. Automation also improves mobility and efficiency by increasing accessibility and capacity utilization, and allowing for more productive activity while traveling. Benefits

from AVs extend to pedestrians and bicyclists, motorcyclists, transportation agencies, and the trucking industry. Automotive and tech companies, including startups, are aggressively leading the advances. Automated driver assistance features (e.g., lane assist, emergency braking) are now widely available. At the other end of the spectrum, auto makers have already logged millions of miles of highly automated (driverless) testing, and driverless minibuses on fixed routes are proliferating around the world. In between, partial or conditional automation will be increasingly available to consumers, which should work in limited situations, e.g., uncongested highways with clear pavement marking. But the expectation here that drivers pay attention or remain available to take over is in conflict with automation making it easier than ever to be distracted. Safely navigating complex AV issues in the coming years will be challenging, and an incredible opportunity for Wisconsin. There has never been a better time for private-public partnerships and working with the multidisciplinary strength of UW-Madison's research enterprise to move Wisconsin companies to the forefront in this area. In parallel, a burgeoning CV/AV industry in Wisconsin will undoubtedly be a high tech job creator and build on the strengths of WMC members. n

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October 2017 25

BU S I N E S S WO R L D

White Salmon and Generational Differences By Jack Orton Director Business World and Future Wisconsin

n insidious slander has been leveled against the so-called “Millennial” generation. It says “Millennials” (individuals born between 1980 and 2000) must be coddled, indulged and “properly understood.” And, it's being perpetuated by some of the most shameless hucksters since Barnum and Bailey. It’s “hogwash,” as my grandfather used to say. “Pure hogwash.” This summer, some of the most talented, most creative, hardest working students in Wisconsin participated in the Business World summer program organized by the WMC Foundation. Students from every corner of the state, all of them members of this “dreaded” Millennial generation, sought out the program as a way of furthering their business and economics education. Every one of them demonstrated an eagerness to learn and a willingness to work hard through an exciting and, often times, rigorous, four-day overnight summer camp. The Business World program has had the same proven curriculum in place for the last 35 years; proven to encourage the growth and imagination of Wisconsin’s future leaders. And while the organization and leadership of the program has changed since 1982, the core curriculum has not. During the program, students learn the value of career planning, business ethics, the history of the free-market system, the inner workings of Wisconsin’s economy and so much more. Year after year, business professionals and college professors,

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chamber executives and entrepreneurs from all over the Midwest volunteer to help the students during the program by facilitating discussion, encouraging ideas, and pushing the students to be successful. Year after year, participating students come up with more creative, calculated and innovative business ideas that seem to demonstrate one thing: the transcendence of the teenage American spirit. For the past few years, pundits have accused the Millennial generation of, among many things, a poor work ethic, insubordination and general laziness. Even here in Wisconsin, there are those who preach a message of conceit and generational snobbery; who bounce from community to community explaining that Millennials are the largest generation now entering the workforce and society must conform to their particular wants and needs or perish. It’s a message that seeks to drive a wedge between generations for no other reason than to be provocative. But this is an old marketing technique. It is a way of transforming a perceived disadvantage into an overwhelming advantage. It’s how P.T. Barnum was able to sell a truckload of unmarketable white salmon to a bustling New York street market—by slapping a sticker on it and saying “Guaranteed not to turn Pink in the Can.” These generational hucksters are trying to mislabel and misrepresent the coming generation as somehow lacking and different to fool you. It is natural for every generation to question the maturity, judgment and work ethic of the next genera-

tion. Didn’t the parents of the Roaring 20s shake their heads at Flappers, Zoot-Suits and the boozy Jazz Age? Didn’t parents of the 1960s think the Rolling Stones’ appearance on the Ed Sullivan Show was a harbinger for the end of the world? What are these con-artists trying to accomplish by slandering an entire generation? They, no doubt, see the “generation question” as an opportunity to elevate themselves to a point of perceived enlightenment. By bamboozling the world with their mislabeling, they will have “proved” their clairvoyance and self-appointed “expertise.” And, what exactly is destructively different about Millennials from other generations? According to a survey done by Goldman Sachs, a growing number of Millennials are choosing to live at home with their parents longer than generations prior—30 percent of 18–34-year-olds in 2010, as opposed to 27 percent in 1990. But, it is worth mentioning that the majority of the Millennial population entered the workforce during the significant economic downturn of 2007–2010, making jobs harder to find, in the first place, and stagnant wage growth if a job was found. Meanwhile the costs of goods, services and rent made it almost impossible for a Millennial to live on their own and still pay for housing. Millennials are also more reluctant to buy luxury goods, like houses and cars, or even get married. They are “putting off” the “significant milestones” that generations before them

were eager to hit. The median marriage age in 1970 was 23. Now, the median age is 30. According to the same survey, students are healthier than ever before. They are exercising more, eating smarter and smoking less than students were even fifteen years ago. The percentage of high school seniors who disapprove of people 18 or older smoking 1 or more packs of cigarettes a day went from 69% in 1998, to 83% in 2013. And, a similar poll, conducted last fall by the Victims of Communism Foundation, found that Millennials are incredibly under-educated when it comes to understanding different political and economic ideologies. Indeed, it is one of life’s most pronounced ironies that the “most informed generation” (Millennials)—a generation that has more information and more technology in the pocket of their jeans, than that which sent man to the Moon— is disturbingly ill-informed when it comes to capitalism vs. socialism vs. communism. There seems to be a growing number of students who believe more in socialist principles than in capitalist ones. But, it is becoming more and more obvious that there is not an active anti-capitalist sentiment among students, rather students are simply under-educated in these subject areas. The Business World program had nearly 200 students participate in its program events this summer—200 of the best and brightest Wisconsin has to offer. Despite the babble, despite the useless chatter, despite the slander leveled against them, Wisconsin’s future business leaders rose to the occasion and successfully completed another summer of Business World events. Generational misunderstanding is nothing new. But, the idea that the entire world must change in order to indulge the particular wants and needs of one generation is an idea that must be undone. n Are you interested in supporting the Business World Educational Program? Please contact the program’s director, Jack Orton, at jorton@wmc.org.

Students at the Business World Summer Camp in De Pere.

1 2

1: WMC President Kurt Bauer speaks to students during the De Pere program. 2: Students scavenge for components to build their products. 3: Students exhibit their products at the product trade show.

Students at the Business World Summer Camp in Madison.

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October 2017 27

WISCONSIN CHAMBER OF COMMERCE EXECUTIVES

Chamber Executives Gather for Annual Conference E xecutives from more than 50 local chambers of commerce came together at the end of September for the annual Wisconsin Chamber of Commerce Executives (WCCE) Annual Conference. The conference is designed to be a one-stop shop for all chamber professionals. The multi-day event provides chambers with educational programming to help executives put their best foot forward when they return to the office. Breakout sessions included topics such as time management, how to grow membership and budgeting. Additionally, Wisconsin Economic Development Corporation (WEDC) Chief Operating Office Tricia Braun gave an update on Foxconn and their new marketing plan to attract workers to Wisconsin.

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“I learned a lot,” said Waukesha Business Alliance President/CEO Suzanne Kelley. “We had some fantastic training on how to get your members more engaged, how to reach out to disengaged members and how to really figure out what businesses in our communities are looking for from the chamber of commerce.” Attendees also heard from John Koskinen, Chief Economist for the Wisconsin Department of Revenue, and two representatives from the Federal Reserve Bank of Chicago. In addition to the speakers, many WCCE members said the conference was a great chance to network with executives from other chambers. “It’s a professional development opportunity. It’s building the strength

through the networks here,” said Wausau Region Chamber of Commerce President/CEO Dave Eckmann. “It’s really opened to my eyes to how I can be a better leader and how I can run a more effective organization as we serve our membership and try to attract members.” The conference took place during the first statewide Chamber of Commerce Month, at the end of September. Additional programs are available to WCCE members throughout the year, including the Washington, D.C. Fly-In. n For more information about WCCE and its programing, please contact Susan Nyffenegger at snyffenegger@ wmc.org.

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October 2017 29

O N RA M P M A N U FAC T U R I N G C O N F E R E N C E

Startups, Corporations Advance Manufacturing

n September 6th, the manufacturing industry’s leading corporations, investors and startups gathered at Miller Park in Milwaukee for a day of networking, professional development and deal-making. The inaugural OnRamp Manufacturing Conference was produced by gener8tor, a nationally ranked startup accelerator based in Wisconsin. Presented in partnership with WMC, the one-day event consisted of conference programming, as well as curated one-on-one pitch sessions between startups and corporate venture capital and innovation executives in the stadium’s box-level suites. Over 600 people turned out at the ballpark to discuss and discover the innovations disrupting the manufacturing industry, the leaders making such innovations possible and how new technologies and business will reinvent the industry. More than 300 startups from around the country, representing more than $750 million in venture capital, applied for the opportunity to take coveted one-on-one meetings with the 30 participating corporations which included A.O. Smith, Badger Meter, Caterpillar, Charter Manufacturing, DuPont, Clorox, Foxconn, GE, Kerry, Kohler, Lowe’s, Rockwell Automation, Sargento and UPS among others. Startups selected for meetings were allotted 20 minutes to pitch their products and offerings which ranged from IIoT, software analytics, supply chain, and additive manufacturing solutions to artificial intelligence and

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machine learning technologies. Sixty thought leaders and manufacturing experts participated on stage during the 19 plenary and breakout sessions. Snap-on Chairman and CEO Nick Pinchuk kicked-off the day with a keynote presentation on the State of Manufacturing. Addressing the crowd from the top of the third base dugout, Mr. Pinchuk underscored the necessity of appealing to the next generation of workers through a major rebranding of the industry and emphasized the importance of upskilling the workforce. Panels, fireside chats and product demos took place indoors on the PNC and Terrace levels of the stadium. Topics included The Future of Venture Capital in Industrials, Innovating for OSHA, Cybersecurity and Manufacturing in the Digital Era, Big Data, The Ins and Outs of Collaborative Robotics, Smart Factories and Innovations in Supply Chain. Attendees enjoyed a ballpark lunch, networking meetings and a closing happy hour reception with spectacular views of the baseball field from the club level lounges and outdoor viewing decks. With excellent reviews from corporate, investor and startup attendees, gener8tor looks forward hosting the next OnRamp Manufacturing Conference in Wisconsin in October 2018. n For more information on gener8tor and OnRamp Manufacturing, contact Clare da Silva at clare@gener8tor. com.

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October 2017 31

P O L I CY DAY

Inaugural Policy Day Features Walker, Johnson

mployers across the state are familiar with Business Day in Madison, which happens each spring at the Monona Terrace Community and Convention Center. However, Wisconsin Manufacturers & Commerce (WMC) launched a new event in August aimed at having a more detailed discussion on policies that impact businesses each and every day. On August 16, more than 200 people came together to hear from experts on issues ranging from energy and environment to taxes and human resources. Thanks to the generous support of Alliant Energy, BDO and Ogletree Deakins, business professionals from around Wisconsin were given the opportunity to have a candid conversation with specialists about these topics. In addition to these smaller breakout sessions, attendees had the opportunity to hear from U.S. Sen. Ron Johnson and Gov. Scott Walker. Sen. Johnson highlighted the need for increased scrutiny on regulations, claiming it is one of the main things holding back companies looking to expand. He said at the event that “grotesque regulation” from the federal government is keeping economic growth in this country from realizing its full potential. “Over-regulation is the silent killer,” Sen. Johnson remarked at Policy Day. Gov. Walker was upbeat about Wisconsin’s potential during his speech to Policy Day attendees. His main focus

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Business Friend of the Environment Award Winners: Environmental Sustainability

was on the transformational impact of Foxconn coming to Wisconsin. He highlighted the 13,000 jobs that would be created by Foxconn directly and their facility, which would be 20 million square feet—big enough to fit 11 Lambeau Fields. One concern raised about Foxconn coming to Wisconsin was the already tight labor market, but Gov. Walker had a simple response for those who were worried. “Wisconsin is ready,” he said to attendees. Gov. Walker spoke about Fast Forward grants that can help companies to train employees. He also highlighted Wisconsin’s network of technical colleges, which will prepare individuals from all across the state for current and new job opportunities. The Business Friend of the Environment Awards and the Human Resources Professional of the Year Awards were both handed out at Policy Day, as well. n Interested in Policy Day 2018? Contact Brittany Rockwell at brockwell@ wmc.org.

Nelson and Pade, Inc., Montello Masters Gallery Foods, Inc. Plymouth UPS, Elm Grove

Environmental Stewardship T.Wall Enterprises, Middleton American Transmission Company, Waukesha Alliant Energy, Madison

Environmental Innovation Orion Energy Systems, Inc. Manitowoc Frito-Lay, Beloit Regal Beloit Corporation, Beloit

Human Resources Professional of the Year Award Winners: Large Employer Category Cliff Sanderson, Mayville Engineering Company Medium Employer Category Wendy Culver, Mead & Hunt, Inc. Small Employer Category Michelle Anomaly, Stellana US Inc.

W M C F O U N DAT I O N

Workforce and Wisconsin's Future By Kari Hofer WMC Foundation Executive Director

isconsin’s workforce is one the best in the nation. We have good work ethic and good avenues for professional development (i.e. our education systems). It’s no wonder Foxconn decided to invest in Wisconsin. One can’t argue against the quality of our workforce, but we all can agree there is a growing need for more. Wisconsin, at full employment, has reached a tipping point for its workforce need— either we get more people to move to Wisconsin, or our economic growth will be stunted with a cap on expansion. Given these economic opportunities available and coming ahead, WMC Foundation has taken on this task not just for 2017, but for the foreseeable future. The WMC Foundation’s official mission is to provide business and economics education, promote the value of the free enterprise system and ensure a high quality of life for our citizens. All of this points directly at workforce and solutions for these challenges. What are doing? Wisconsin Business World is taking the approach of educating young people just before they enter the professional workforce. Business World is our business and economics summer camp for high school students that is the reason WMC Foundation was founded in 1982. In 2017, we added financial literacy, business ethics, and career planning. Looking to 2018, we’d like to continue to include those units, but build further on career planning

with education on the importance of soft skills in the professional world, such as etiquette, timeliness, communication practices and even sobriety. In addition, Business World is one of the few programs in the state that doesn’t limit further education to four-year university study, but rather exposes students to opportunities

Either we get more people to move to Wisconsin, or our economic growth will be stunted with a cap on expansion. available in trade school or the technical college system. As our state’s open hiring positions require diverse training backgrounds, so must our guidance upon the upcoming workforce. The Future Wisconsin Project takes a more macro approach involving leaders from government, education and the business spheres. This initiative includes a strategic partnership between WMC, Wisconsin Chamber of Commerce Executives (WCCE), Wisconsin Economic Development Corporation (WEDC), Wisconsin Department of Workforce Development (DWD), UW System, Wisconsin Association of Independent Colleges and Universities (WAICU) and the Wisconsin Technical College System. Leaders from each of the partners come together to address generally Wisconsin’s future economic

challenges, but more specifically Wisconsin’s future workforce challenges, as workforce is our number one economic challenge. It is clear, if we can provide meaningful education that supports the economic industries of the state, and government agencies can provide assistance to support these initiatives, the business community will have the tools and the confidence to continue investing in Wisconsin. However, it’s not a one-way street. This is a partnership, a relationship that requires all components of the economy to work together for the good and prosperity of our citizens. As Foxconn moves forward with their plans, our economy will be changing, but we will be ready. WMC Foundation is contributing to solutions by engaging and educating our young workforce, and bringing together strategic partnerships for broad impact. Join us for the Future Wisconsin Summit featuring presentations by each of the Future Wisconsin Project partners addressing workforce and Foxconn coming to Wisconsin; Wednesday, November 29, 2017 at the Monona Terrace in Madison. n For more information, visit www.futurewi.org. For more information about the WMC Foundation and how to get involved, contact Kari Hofer at khofer@wmc.org.

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I N T E R N AT I O N A L

Language Roadmap Key to Economic Opportunities By Guido Podestá Vice Provost and Dean, International Division, University of Wisconsin–Madison

focus on building strong relationships with businesses and countries around the world is key to ensuring Wisconsin’s economic future. However, attracting lucrative international opportunities will require a workforce that is able to communicate and interact with people across borders and cultures. A proactive plan to develop these essential talents will poise Wisconsin for economic success at home and abroad. Wisconsin’s international trade relationships and exports already contribute significantly to the economic profile of the state. According to the International Trade Administration, foreign-owned companies employed 90,000 Wisconsin workers in 2014. Last year, Wisconsin exported $21 billion in goods and services to foreign nations, with the top 5 export markets including Canada, Mexico, China, Japan and the United Kingdom. Engaging these markets and expanding into new ones necessitates language and advanced cultural competencies—skills that allow Wisconsinites to communicate and successfully navigate partnerships with foreign governments, businesses and organizations at home and abroad. While 36 percent of Wisconsin K-12 students are enrolled in world language courses, many are not developing their abilities to a level that allows them to speak, write and interact in a professional capacity. Wisconsin’s educational institutions—K-12 schools, community and technical colleges and universi-

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ties—need to prioritize opportunities for sustained learning so students will be able to leverage these skills in workplaces that are increasingly without borders. The National Security Education Program of the U.S. Department of De-

According to the International Trade Administration, foreignowned companies employed 90,000 Wisconsin workers in 2014. fense recently awarded the University of Wisconsin–Madison a grant to create a strategic plan to develop advanced second language skills and intercultural competencies for Wisconsin students. This grant, the Wisconsin Language Roadmap Initiative, will assist the state in creating educational opportunities at all levels that will yield a multilingual and culturally agile workforce. Such skills are sure to help Wisconsin expand into

new and emerging markets worldwide. This first objective of the Wisconsin Language Roadmap Initiative is to assess the current and projected needs for language and cross-cultural competencies in the state, in addition to current K-16 educational capacities. A summit will convene in January 2018 to solicit input from leaders from multiple sectors across the state. These insights will be incorporated into a comprehensive language roadmap for Wisconsin that will be released in May 2018. While UW–Madison has strong language resources that uniquely position the university to lead the initiative, developing the language roadmap is not something that can be done by the university alone. Collaboration with Wisconsin’s business, nonprofit, education, government and healthcare sectors will be essential to developing a plan that align Wisconsin’s educational system with the needs of the private sector and poise Wisconsinites for success in the global market. Those interested in learning more about the initiative can view additional information at wisconsinlanguageroadmap.net. The site also allows interested parties to sign up to receive an upcoming white paper summarizing both Wisconsin’s current resources in language education and the state’s needs for enhanced multilingual and cultural fluency, as well as the Wisconsin Language Roadmap. n

M A N U FAC T U R I N G TO U R

Manufacturing Tour Makes Stops Throughout the State W isconsin Manufactures & Commerce (WMC) and the Wisconsin Safety Council (WSC) partnered to host five stops across the state highlighting manufacturing. The State of Wisconsin Manufacturing Tour featured panel discussions in Milwaukee, Eau Claire, Wausau, Neenah and Beloit. The main focus of each roundtable was workforce. Each of the panels, which featured guests from local businesses, K-12 schools, technical colleges, the UW System and the state Department of Workforce Development, highlighted the need for more workers in the state. WMC President/CEO Kurt R. Bauer moderated each panel and talked about the need for all of these partners to work together to solve the worker shortage. “There are many different things that businesses are working on with local K-12’s, their technical college, the UW System and on apprenticeships and internships to expose young people to the types of careers that are here in this area,” Bauer said at a stop in Wausau, which was hosted by Northcentral Technical College.

Bauer said it is important to get people interested in these careers at a young age and then prepare them for the workforce through proper education. Many of the panelists argued that there is a lack of interest in manufacturing. Bauer claimed one way to combat that is to talk about all the cool products that are made in Wisconsin. “There are a lot of great things made in the state of Wisconsin that people just are not aware of,” he said at the stop in Eau Claire, hosted by Chippewa Valley Technical College. “We want to develop local, regional and statewide pride in what’s made in Wisconsin.” The tour concluded with a stop in Beloit that was cohosted by the Hendricks Family Foundation and CareerTek. This event featured special guest Mike Rowe, star of the popular TV Show, “Dirty Jobs.” Rowe spoke about the importance of the skilled trades and highlighted how rewarding they can be during the program. n

Eau Claire

Neenah

For more information about the tour, please visit wmc.org.

Wausau

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S P E C I A L F E AT U R E

Foxconn: What it Means for Wisconsin

s the story goes, President Donald Trump and then-White House Chief of Staff Reince Priebus were flying over Kenosha after a Wisconsin event in the spring and the President asked Priebus about the shutdown Chrysler plant. That led to the President looking for an opportunity to return jobs and opportunity to the state, specifically southeastern Wisconsin. Mark Hogan, Secretary and CEO of the Wisconsin Economic Development Corporation (WEDC), was on a plane with Gov. Scott Walker and his Chief of Staff Rich Zipperer shortly after to meet with Foxconn Chairman Terry Gou. Then there was a breakfast meeting at the governor’s residence in Madison with a few other folks—including Department of Administration Secretary Scott Neitzel—and it kind of took off from there. So now that Foxconn is coming to Wisconsin, what does it mean for the state? Wisconsin Business Voice sat down with both Hogan and Neitzel to find out: Does this change the perception of Wisconsin? Neitzel: We had a very good reputation nationally and internationally as having a strong workforce, a good manufacturing history and a skilled labor force. So, we have that to build on, but Foxconn will take us to the next

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level of high-tech manufacturing. Hogan: The key point, and Scott alluded to it, is that we could not have had this opportunity without the manufacturing legacy in our state. It stands on the shoulders of the thousands of manufacturing companies that are here, and the hundreds of thousands of employees that have been in manufacturing over the past 150 years. What does this mean for Wisconsin’s economy? Neitzel: Economists will want to measure the impact, but I think it is going to be hard to measure. It is going to be very impactful, whether it is all the major suppliers, the suppliers to the suppliers, or the suppliers to the suppliers to the suppliers. Then when you look at where people are going to be housed—apartments, condos, single-family homes—that will create even more jobs and opportunity. You can even look to the Milwaukee County budget. County Executive Chris Abele is putting in money for a new international terminal. I just think it is going to be hard to understand the secondary, tertiary and quaternary effects of this project. The state is investing a lot of money in Foxconn, what is the return on that investment? Hogan: We are getting an industry that does not exist in the United States,

and all of the things that go with it. This will create opportunities we never seen before. These opportunities include those for local businesses, for academic institutions, and it is a reason for people to come to Wisconsin. Our state already has high quality health care, high quality education, and businesses that are already here, this just takes us to another level. Neitzel: I always try to remind people that the government does not necessarily spend money to make money. Government spends money to get public policy outcomes. One of our issues is keeping our graduates in the state, but we also want to attract people from other states. This will be a talent attractor. That is a public policy objective met. Another issue is venture capital. This takes us closer to these top-tier states like California and New York. That gives us a leg up on venture capital and capital formation. That is another public policy objective met. As a public policy goal, we also want to make sure people have jobs that are family supporting. These jobs are almost $54,000 a year plus benefits. That is a public policy return that we get. Then at the end of it, we still get a financial return. Even if you take the LFB memo, which says it will take 25 years to see a financial return for the state—and I think the analysis is very conservative—we still meet all these other public policy objectives that we

S P E C I A L F E AT U R E

want to meet. There are very few investments the state can make that have that broad-based of an impact and meet so many of our high-priority public policy objectives. What excites you most of the possibilities brought on by Foxconn? Hogan: There are two things. One, it is an opportunity for southeastern Wisconsin—Milwaukee specifically—where there is a large underemployed and unemployed population. It is an incredible opportunity for us to work with that population to get them the skills necessary. Whether it is working for Foxconn directly or working for some of the supply chain, that will be significant. The second part is giving the next generation and the generation after that the opportunity to want to be in Wisconsin. Foxconn will give so many people the chance to live and work in Wisconsin for decades to come. Neitzel: With Foxconn here, the state’s economic future is a much better position than it was without Foxconn. We are doing very well, but this takes us to the next 25, 40, 50 years of moving the state forward. We have always been a leader in manufacturing, and this makes us a leader in high-tech manufacturing, which will ensure we don’t get left behind. n Want to find out more about Foxconn and its impact on Wisconsin, register for the Future Wisconsin Summit on Nov. 29. Secretaries Mark Hogan and Scott Neitzel will be on a panel taking your questions. More information at wmc.org. *Responses edited for clarity and length.

BY THE NUMBERS

13,000

22,000

Jobs Foxconn will create in Wisconsin, making it the largest single economic development project in state history.

Additional jobs Foxconn’s investment will create through suppliers and other businesses that will compete to be part of Wisconsin’s new economic growth.

10,000 $53,875

Construction jobs necessary to build Foxconn’s state-of-the-art manufacturing facility.

Average wage of workers who fill the high-tech jobs Foxconn will creates.

$10,000,000,000 Money Foxconn will invest in Wisconsin's economy by 2020

FOXCONN FACTS • This project is not only the largest single economic development project in Wisconsin history—it’s the largest “greenfield” investment on new land in U.S. history • Foxconn’s investment will create the largest and most advanced liquid crystal display (LCD) facility in the world, and make Wisconsin the epicenter of a new American hightech manufacturing ecosystem • All this economic activity will completely transform Wisconsin’s economy by drawing suppliers and other companies to the state of Wisconsin, and creating high-tech jobs for generations to come

• Foxconn is a leader in environmentally sustainable manufacturing—it’s central to maintaining Wisconsin’s quality of life and the workforce advantage that drew Foxconn here in the first place • Workers at Foxconn’s Wisconsin facilities will be involved in the manufacturing of high-tech components used in TVs, computers, cars, and more—these are safe, highskill jobs for the future

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W H I T E H O U S E F E L LOW S H I P

Working at the White House By Austin Ramirez Chief Executive Officer, HUSCO International

first learned of the White House Fellowship in 2003, when a colleague at McKinsey & Company encouraged me to apply for the program. I was in my early 20’s at the time, with a casual interest in politics but a laser-like focus on building my business career. Thirteen years later, frustrated with the deterioration of civility and thoughtful discourse among our political leaders, I decided it was time to stop complaining and start trying to make a difference. Founded in 1964 by President Lyndon Johnson, the White House Fellowship is considered one of America’s most prestigious leadership development program. Each year, 10-20 mid-career military and private sector leaders are selected to serve for 12 months as paid, full-time staff to senior White House leaders or Cabinet-level government officials. It is a non-partisan program and provides an unparalleled opportunity to experience working at the highest level of the Federal Government. Notable alumni of the program include General Colin Powell, Missouri Governor Eric Greitens and CNN correspondent Dr. Sanjay Gupta. It was the honor of a lifetime to be selected to serve as a White House Fellow in June of 2016, after a six month application process and three grueling days of interviews in Washington, DC. After being selected, I interviewed at 14 federal offices including the Department of Defense, United States Trade Representative and the Office of Management and Budget. I was ultimately placed at

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my top choice, the National Economic Council, where I reported for work in August. In the six weeks between being selected as a Fellow and starting my new job at the White House, I implemented an interim leadership structure at HUSCO, relocated my wife and two young children, transitioned out of seven nonprofit boards, ran a 100-mile trail race at elevations between 9,000 and 12,000 feet, and secured a topsecret clearance. So you can say it was a hectic time. My time working in the White House was uniquely defined by the transition between President Obama and President Trump. I had the opportunity to observe these men operate in both public and private settings, and I worked closely with their respective teams to wind down one administration and ramp up another. My work responsibilities included policy development related to self-driving cars, unmanned aerial vehicles, smart city technology, semi-

conductor industrial policy and manufacturing. During my year as a Fellow I had the opportunity to work in the Oval Office, attend meetings at the United Nations in New York, interview members of parliament in the African nation of Swaziland and land a jet on a working aircraft carrier in the Pacific Ocean. My kids trick-or-treated at the White House and rolled Easter eggs on the South Lawn. My wife and I toasted President Obama at his last White House Holiday party and witnessed President Trump’s inauguration from the National Mall. I am immensely grateful for the opportunity to serve these past 12 months, but more frustrated than ever with the inability of our elected leaders to deliver the policy solutions that our country so desperately needs. My time in Washington renewed my love for HUSCO and deepened my pride in the vital impact that small- to mid-sized manufactures have on our nation’s economy. It reinvigorated my commitment to the Milwaukee community as one the best places in the country to live, work and run a business; and it ignited a desire to do what I can to help transform the broken incentive structure that rewards unproductive behavior by our representatives in Washington and Madison. Years from now, I hope I look back at this formative time as the spark that drove me to more fully engage in issues that matter to our community and our country. It’s a responsibility we all share, and is one I now take more seriously than ever. n

I N N OVAT I V E ST RAT EG I E S

A New Hiring Strategy for Wisconsin By Lisa Fiore Chief Operating Officer, Manpower-FL/IA/MN/WI

ue to a lack of available talent, nearly 77 percent of Wisconsin employers report having difficulty finding skilled workers according to a Wisconsin Manufacturing & Commerce report. “It’s one of the most competitive talent markets we’ve seen to date in West Central Wisconsin” says Steve Jahn, Executive Director of Momentum West. Low unemployment paired with shorter skill cycles due to the speed of technological change means area employers are struggling to fill positions. These global trends are playing out right here in Wisconsin, with corporations and employers today searching desperately for new ways they can attract and retain top talent. Momentum West, a regional economic development organization, is working on a solution called the Candidate Referral Network that is set to have a big impact for Wisconsin. The Network will play a critical role in the area employer’s recruitment strategies putting all candidates at the center of the hiring process. This bold new strategy, in partnership with Manpower, a staffing service based out of Eau Claire, WI involves collaboration among employers in the region. It challenges employers to be open to new ways of finding and recruiting talent. “Attracting in-demand talent is quite an achievement”, says Jahn. “And, in West Central Wisconsin, our goal is not to only attract candidates to our

area but also retain the talent that exists here and to grow and develop their skills.” According to Forbes Magazine, annually, U.S. employers spend over $72 billion on recruiting services which includes advertising, job boards, etc. And, yet, traditionally employers hire on a one-to-one ratio, leaving many job applicants rejected.

Annually, U.S. employers spend over $72 billion on recruiting services which includes advertising, job boards, etc. Participating employers in West Central Wisconsin are using the Candidate Referral Network in two ways: • To make referrals of job applicants not selected for their com-

pany’s position. No one likes to turn a job applicant away. By connecting the candidate to the CRN, they get connected with other area employers, with similar skill needs, helping them to stay in West Central Wisconsin and get ahead. • As a strategic subset of networking to source and recruit talent. It helps grow our candidate base and shorten the path from open position to the candidate being hired. Employers must be candidate driven—with all candidates—hired or not hired. By referring non-selected candidates to the Candidate Referral Network, the company protects its brand image among future job applicants. Another project Momentum West’s Talent Attraction and Retention Committee is working on is focused around Collaborative Hiring—or Talent Sharing. This creative hiring model eases the talent shortage by taking job-sharing outside of one organization and sharing talent among several employers with like hiring needs. n For more information on the Candidate Referral Network or on Talent Sharing, contact Lisa Fiore at LisaF@mnpwr.com or at 715-552-9128.

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COOLEST

THING

MADE IN