Rebuffing Scott Walker, Minnesota lawmaker says his state is better than Wisconsin for business

Minnesota state Rep. Joe Atkins got perturbed by what he said were Gov. Scott Walker’s attempts to lure companies across the border by portraying Wisconsin as the better place to do business.

So Atkins, chairman of the Minnesota House of Representatives’ commerce committee, called a meeting of the panel on Aug. 29, 2013.

The purpose was to hear testimony on whether the Badger State is really in a stronger position to attract businesses than the Gopher State.

Afterward, Atkins, a Democratic­-Farmer­-Labor Party member from the Twin Cities area, declared:

"The objective data shows that, frankly, Minnesota is kicking butt relative to Wisconsin on everything from employment and job creation to school test scores, educated workforce and a host of other factors and rankings," he said, according to the Minneapolis Star Tribune.

"I understand the desire to promote one's state, but (Walker’s) full of baloney when it comes to saying that Wisconsin is a better place to put your business than Minnesota."

Baloney, we can’t (and don’t want) to test.

"Kicking butt," we can.

We know, for example, that Wisconsin has kicked Minnesota’s butt in college football for more than a decade, including winning the last nine games in a row.

So, let’s check the thrust of Atkins' claim -- that Minnesota’s business climate is clearly superior to Wisconsin’s based in particular on four measures Atkins singled out, but on other measures, as well.

Employment

To back the first part of his claim, Atkins cited the unemployment rate.

The latest monthly figures, for July 2013, show Minnesota at 5.2 percent, nearly one-quarter lower than Wisconsin’s 6.8 percent.

BLS data also show that Minnesota’s rate was at least 1.5 percentage points lower than Wisconsin’s in each month from January through June of 2013.

In response, Walker spokesman Tom Evenson cited figures showing Wisconsin’s labor force participation exceeded Minnesota’s. But labor force participation measures not only people who are employed, but also people who are unemployed but actively looking for work. So, it’s not a strict measure of employment, per se.

Job creation

Atkins cited the latest month-to-month U.S. Bureau of Labor Statistics figures, which show the number of people employed in July 2013 vs. July 2012.

They show that in Minnesota, an additional 55,000 people became employed, compared with 25,800 more in Wisconsin.

We calculated that to be an increase of 2 percent for Minnesota, more than double Wisconsin’s growth of just under 1 percent.

Atkins also cited reports by Congress’ Joint Economic Committee; Democratic Minnesota Sen. Amy Klobuchar is the committee’s co-chair. The latest report, released in July 2013, shows that since the recession, Minnesota job growth was 0.1 percent while Wisconsin lost 1.5 percent of its jobs.

We also found June 2013 rankings by The Business Journal for private-sector employment growth. Both Walker and Minnesota Gov. Mark Dayton, a Democrat, took office in January 2011. Dayton was ranked 15th among governors, with a 2.01 percent growth rate during his tenure; Walker was ranked 40th at 1.07 percent.  

School test scores

Both Atkins and Evenson cited results of the ACT college entrance exam.

We found that for the class of 2013, among states where more than half the students took the ACT, Minnesota ranked first and Wisconsin tied with Iowa for second.

Minnesota’s average score of 23 and Wisconsin’s was 22.1. That's a pretty significant gap, given that the range of scores was small, from 18.7 to 23.

Educated workforce

To back this part of his claim, Atkins cited the percentage of residents age 25 and over who had a bachelor’s degree. His figures were dated, so we found the most recent figures, for 2011, which show Minnesota’s education attainment about one-fifth higher than Wisconsin’s.

In Minnesota, 31.9 percent of residents had a four-year degree or higher. In Wisconsin, the rate was 26.2.

OK.

So, how did Atkins’ four measures score out?

Minnesota kicked butt in the sense that it outperformed Wisconsin on all four measures, and by comfortable margins.  

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Kenneth Block

stated on November 8, 2013 in an interview on Rhode Island Public Radio

Rhode Island's unemployment insurance system "is the most expensive such system in the country."

Other measures

The rest of Atkins' claim was that Minnesota also beats Wisconsin on a host of other business climate-related measures. He and Evenson cited some, and we found some, as well.

Compared to the measures Atkins cited, the results are more of a mixed bag.

On some measures, Minnesota ranked better than Wisconsin.

-- Business climate: The latest Forbes ranking of states for business, released in December 2012, listed Minnesota 20th and Wisconsin 44th overall. In terms of economic climate, Minnesota ranked 20th and Wisconsin 29th. The magazine considered costs, labor supply, regulatory environment, current economic climate, growth prospects and quality of life. And CNBC's "top states for doing business" ratings for 2013 ranked Minnesota 15th and Wisconsin 22nd. The business news TV network's index uses 51 measures of competitiveness.

-- Competitiveness: The Beacon Hill Institute, a free-market think tank at Suffolk University in Boston, released its annual competitiveness index in April 2013. The index, which assesses government and fiscal policy, infrastructure, business incubation and other factors, ranked Minnesota third and Wisconsin 18th.

-- Economic growth: A U.S. Commerce Department report released in June 2013 showed Minnesota’s gross domestic product increased 3.5 percent in 2012. That was more than double Wisconsin’s 1.5 percent.

Wisconsin did better on other measures.

-- Business climate: In November 2012, Site Selection magazine ranked Wisconsin 13th on its list of top 25 states for business climate. Minnesota didn’t make the list. The study was based in part on surveys of corporate site selectors.

-- CEO survey: A national survey of 736 chief executive officers by Chief Executive magazine, published in March 2013, ranked Wisconsin the 17th best state for doing business, with Walker’s election cited as a key reason. Minnesota ranked 30th, with Gov. Dayton’s support of tax increases cited.  

-- Private investment: A July 2013 report by the Private Equity Growth Capital Council rated the top 20 states by "investment value and the number of investments." Wisconsin ranked 14th at $9.1 billion; Minnesota didn’t make the list.

On still other measures, the two states were about even.

-- Business taxes: The Tax Foundation’s "2013 state business tax climate index," which is based on how 100 tax variables affect competitiveness, rated both states as among the worst, with Wisconsin at 43rd and Minnesota at 45th.

-- Entrepreneurial activity: Measuring entrepreneurial activity as being high, medium or low for 2012, the Kauffman Foundation put both states in the low category.

-- Business climate: In an April 2013 report on small business (companies with fewer than 500 employees), the U.S. Chamber of Commerce ranked Wisconsin 39th in business climate and Minnesota 40th. Taxes, government regulation and other measures went into assessing business climate. For "overall performance," the chamber put Minnesota 15th, with high ratings for "talent" and infrastructure; and Wisconsin 44th, with low ranks for short- and long-term job growth.

We could go on, but we think the picture is pretty clear.

Our rating

Comparing the two states for business, Atkins said: "Minnesota is kicking butt relative to Wisconsin on everything from employment and job creation to school test scores, educated workforce and a host of other factors and rankings."

Minnesota outperformed Wisconsin by comfortable margins on four measures Atkins singled out, and on several other rankings that used various economic indices. On other measures, Wisconsin led or was about even with Minnesota.

For a statement that is partially accurate, we give Atkins a Half True.