Figures Don’t Lie But…

New data provided by the U.S. Bureau of Labor Statistics reported that Minnesota has now passed Wisconsin in terms of total jobs, however many factors are at play in the way the data has been interpreted. Also, in reaction to the study, many are using the data to compare conservative Gov. Scott Walker with liberal Minnesota Gov. Mark Dayton, to make the argument that Dayton’s liberal polices have produced a better economy that Walker’s conservative reforms.

Wisconsin Public Radio recently published an article containing a U.S. Bureau of Labor Statistics report that claimed Minnesota has been adding more jobs than Wisconsin since 2010, and recently passed Wisconsin for total jobs by 3,096. In addition to WPR, the Economic Policy Institute released a report sharing the information, blaming this in part to differences between Governors Walker and Dayton. The report makes no attempt to hide who they favor with statements such as:

The direct effects of the Minnesota reforms were unambiguously progressive—directing resources toward low- and moderate-income households and strengthening rules explicitly meant to boost these households’ economic leverage and bargaining power. The direct effects of the Wisconsin reforms were unambiguously regressive.

Governor Walker contended that his agenda of shrinking the public sector and reducing the power of unions would lead to stronger private-sector growth, which would ultimately lead to better economic outcomes for Wisconsin workers and their families (Davey 2011, 2015). Seven years later, there is no evidence to validate this claim.

However University of Michigan Labor Economist Donald Grimes told WPR that the unemployment may be a factor in the U.S. Bureau of Labor Statistics report:

The overall numbers come at a time when another job metric — the unemployment rate — dropped to 2.8 percent in Wisconsin according to preliminary figures. That’s a record low.

“To get an unemployment rate that low is great,” Grimes said. “But that means that you’re not going to be able to increase employment any more by reducing that much further.”

Minnesota’s preliminary unemployment rate for April was 3.2 percent.

Also, contrary to the EPI’s report in terms of GDP comparison, the Center of the American Experiment writer John Phelan argues that the EPI’s usage of annual data is less accurate than examining available quarterly data:

It isn’t clear why the EPI are using annual data when there is quarterly data available covering the whole period. Indeed, the quarterly data runs into 2017. Using quarterly data allows us to select a more accurate base period, the fourth quarter of 2010, which covers October, November, and December. This is much more suitable for measuring the performances of guys who took office on the third day of the following quarter.

….contrary to what the EPI argues, since the final quarter of 2010, the last one before Governors Dayton and Walker took office, Wisconsin’s economy has grown by 11.9% and Minnesota’s by 10.9%. Both, it is true, have lagged the national average.

In other words a cherry-picked number may be accurate, but not provide a complete economic comparison between the two states.