That’s what Governor Walker said today about Wisconsin’s economy, quoting from a 1980’s song. This was apparently spurred by DWD’s release “Wisconsin Employment Reaches All-Time High in November”. This statement is true, when referring to the relatively imprecisely measured household survey figures . It is not true when referring the (more precisely measured) establishment series.
Here are trends in nonfarm payroll employment in Wisconsin, its neighbor Minnesota, and the US:
Private nonfarm payroll employment exhibits similar patterns.
Figure 2: Log private nonfarm payroll employment in Minnesota (blue), Wisconsin (red), and US (black), seasonally adjusted, 2011M01=0. Source: BLS, DWD, DEED, and author’s calculations.
In Wisconsin’s case, current employment levels are below March 2016 levels.
The relevant comparison is where employment is relative to a counterfactual. I construct a counterfactual using the dynamic (out-of-sample) forecast generated from an error correction model estimated using private Wisconsin and US employment over the 1994-2010 period (see discussion in this post). The counterfactual is shown in red in Figure 3 (with 90 prediction interval).
The upshot of this graph: Wisconsin private NFP employment is (statistically) significantly lower than what should be expected, based on historical correlations.
As of November 2016, Wisconsin is 55,000 below the number of new private sector jobs Governor Walker promised in August 2013 for January 2015.
By the way, the song refers to an imminent nuclear war…