Wisconsin's Economy Showing Signs of Slowing Down

Wednesday, March 22nd, 2023 -- 11:01 AM

(By Joe Schulz, Wisconsin Public Radio) Wisconsin continues to see historically low unemployment, but the state's economy is showing signs it could be slowing down.

According to Joe Schulz with Wisconsin Public Radio, over the first two and a half months of 2023, the Wisconsin Department of Workforce Development has seen an increase in layoff notices compared to the same period last year.

So far, 1,963 workers have been affected this year. That’s more than half of the 3,821 total employees affected by layoffs in all of 2022. But the most recent unemployment data shows Wisconsin’s unemployment rate remained low at 2.9 percent in January, better than the 3.4 percent national rate that month, according to state Department of Workforce Development, or DWD.

"Wisconsin's historically low unemployment rate, combined with strong job growth across multiple sectors, continues to signal the vitality and resilience of our workforce and economy," DWD Secretary-designee Amy Pechacek said in a March 9 statement.

"While these numbers are incredibly positive, they also call out the need for continued efforts to remove employment barriers and equip workers with in-demand skills."

State data for February hasn't been released, but national unemployment remained low at 3.6 percent last month, Wisconsin typically fares better than the country as a whole in terms of unemployment.

Despite unemployment remaining low, Laura Dresser, associate director of the COWS economic think tank at the University of Wisconsin-Madison, said increased layoffs are tied to the Federal Reserve's efforts to curb inflation by raising interest rates.

"There's federal policy focused on trying to cool economic growth," she said. "I think it's also the case that the economy remains, in spite of that, quite robust in terms of demand for workers. The unemployment rates are staying low and new workers are coming into the labor market."

The Fed’s efforts were designed to reduce inflation by slowing business and consumer spending. The Fed has said it hoped to do so without creating a recession like it did in the 1980s.

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