From the just-released Summer WMC Wisconsin Employer Survey:
“There is no question that the mix of higher costs and higher interest rates are making employers rethink investment and hiring plans,” added Bauer. “While we may not enter into a typically defined recession, this data shows that the economy may stagnate at least through the end of the year.”
Well, the views on the Wisconsin economy are virtually unchanged since the winter survey:
Source: WMC. Notes: n=180, 182, for Winter and Summer, respectively. Survey respondents are members of WMC.
What do objective indicators show about the Wisconsin economy in the 6 months following the Winter survey (released January 17th) (shaded lilac in Figure 1 below)?
Figure 1: Wisconsin Nonfarm Payroll Employment (dark blue), Philadelphia Fed early benchmark measure of NFP (pink), Civilian Employment (tan), real wages and salaries deflated by national chained CPI (sky blue), GDP (red), coincident index (green), all in logs 2021M11=0. Lilac shading denotes the 6 months after the WMC Winter survey. Source: BLS, BEA, Philadelphia Fed [1], [2], and author’s calculations.
Nonfarm payroll employment, as well as real wages and salaries, and the coincident index, all rose during the period in question. Civilian employment, which is not particularly well measured at the state level, alone was flat. Hence, cognitive dissonance part 1.
Despite the lackluster growth prospects seen by the WMC membership, what do firms think they will be doing in terms of employment? Surprisingly, they seem to see their workforces increasing! Hence, my cognitive dissonance, part 2.
Source: WMC. Notes: n=180, 182, for Winter and Summer, respectively. Survey respondents are members of WMC.
One interesting aspect of the Summer 2024 report is that the time series graph indicating the proportion of respondents who rated the Wisconsin economy, included in the Winter 2024 report, was omitted. Presumably, this was because the graph did not fit the WMC narrative. In order to complete the picture, I add in an edited version of the Winter 2024 graph.
Note: Light blue large circle is Summer 2024 observation. Source: WMC, Wisconsin Employer Survey (January 2024), and edits by author using July 2024 survey.
