Janesville35°

Economic landscape in Rock County has changed

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JAMES P. LEUTE
December 18, 2011
— From an economic perspective, Rock County is a much different place than it was just a few years ago.

Fewer businesses, fewer employees, and—for many people—less pay.


In fact, the number of Rock County businesses, the number of their employees and their average pay is at an all-time low in the 2000s.


"Particularly on wages, I don't know that we'll ever see a return to those levels, primarily because of the type of work—assembly manufacturing—that we had in Rock County," said Bob Borremans, executive director of Southwest Wisconsin Workforce Development Board.


In 2010, employees at Rock County businesses earned an average of $36,596 annually, or about $17.59 per hour based on a typical calendar year of 2,080 hours, according to the Bureau of Labor Statistics.


That salary was not the lowest of the decade. That slot was filled in 2001, when average pay was $31,482.


It was also not the highest, checking just below 2008's average of $36,906.


Once known as a manufacturing hub with high wages to match, Rock County has suffered a more significant wage hit in the manufacturing sector, primarily because of the demise or decline of several major manufacturers in the last five years.


In 2010, the average annual wage in the county's manufacturing sector was just more than $50,000, about $24 per hour. That's a drop of nearly 12 percent from the decade's high point in 2006, when the average manufacturing wage was nearly $57,000, or about $27.40 an hour.


The decline is more significant when factored for inflation. For the $57,000 salary of 2006 to have the same buying power in 2010, it would have to exceed $61,000.


That means the 2010 Rock County wage of $50,229—when adjusted for inflation—represents a drop of nearly 23 percent.


The same can be said for all Rock County wages, although not nearly to the extent of manufacturing wages. Adjusted for inflation, the average 2010 wage of $36,596 is about 2 percent behind that paid in 2008.


Pockets of improvement

James Otterstein, Rock County's economic development director, said it's hard to argue with the Bureau of Labor Statistics numbers.


But, he said, there are pockets in Rock County where wages have increased significantly.


Examples include the plastics, food and metalworking machinery manufacturing sectors, which experienced an average annual wage growth of 33 percent since 2001.


Rock County, he said, is similar to the Upper Great Lakes region, where the manufacturing sector has trended away from a single-facility or campus environment with a collective bargaining agreement covering thousands of employees.


Smaller, privately held, niche manufacturers are filling the void, he said.


Displaced workers are becoming more accustomed to what Borremans said is a new reality of lower wages in Rock County. Most openings for manufacturing jobs these days advertise pay of $15-$18 per hour.


"Everyone wants a livable wage, but to live in a rural or smaller urban place requires some sacrifice," he said. "People are making that determination and becoming more accepting of the wages and benefits being offered."


Otterstein hesitates to say the lower wages are a new reality. Instead, he refers to them as a surviving reality.


"Particularly in the manufacturing sector, Rock County has traditionally had a two-tier wage scale," he said. "There was the automotive sector, and then there was everyone else.


"Now, the automotive sector is gone, and what's left is that second tier."


Employment levels

The number of companies doing business in Rock County has fallen every year since 2005.


So, too, has the number of workers.


In 2006—the high point of the decade—more than 68,000 people worked at 3,558 businesses in Rock County.


By 2010, 58,737 employees had jobs at 3,298 businesses.


Not surprisingly, the drop in businesses and employees has been reflected in the county's unemployment rate, which skyrocketed the month after General Motors and several of its suppliers laid off thousands of people at the end of 2008.


After posting an average unemployment rate of 6.2 percent in 2008, Rock County's rate more than doubled to 12.8 percent in 2009. It dropped to 11.1 percent for 2010 and, so far this year, is averaging about 9.6 percent.


Borremans said the tide might be slowly turning.


"Hiring is starting to pick up," he said. "In October, we had 500 more people in the workforce than we did in October 2010.


"We're still not back to where we were in 2008 and 2009, but it's a good indicator."



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