‘I TRY TO STAND TALL, BUT I NEED SOME HELP’
For many in Milwaukee area, American dream is elusive
Victor Goldsberry thought he would always have a job in Milwaukee’s growing hospitality industry.
Goldsberry started working in hotels because that’s where jobs were. Since 1999, he had been at the Hilton Milwaukee City Center Hotel downtown, and although he wasn’t getting rich, he was proud to work in the hotel’s banquet department.
“I was quite pleased,” he said. “It had its ups and downs, but you just had to push through. I was content.”
He was paid on commission and tips, so some weeks were leaner than others. But he had health insurance and never worried about paying his rent. His children are grown and live on their own.
Lately, it’s been nothing but lean. Goldsberry has been virtually out of work since the coronavirus pandemic first swept into Milwaukee. He’s been taking odd jobs, but there’s little hope left in him.
“I try to stand tall, but I need some help and I’m not alone,” he said. He worries about his former co-workers — the housekeepers and lobby attendant. He’s working with the union trying to extend the recall time in his contract. Goldsberry said he just feels despair.
At its core, the American dream is built on hope.
Hope for a better tomorrow. Hope for a better world for our children. Hope that our community and our country are making the right decisions. We seem to talk about those hopes more during a presidential election year than at any other time.
From a practical standpoint, much is dependent on economics, specifically having the income to do better.
A new report from the Milwaukee Area Project at Marquette University Law School’s Lubar Center for Public Policy Research and Civic Education makes the case that by one key economic measure, the Milwaukee metropolitan area isn’t just in a rut, it’s been skidding backward for years — even decades.
Some of that is the result of COVID-19. Between mid-March and mid-October, the state Department of Workforce Development processed 7.4 million weekly unemployment claims, paying nearly $4 billion in unemployment benefits to more than 536,000 claimants.
But the Lubar Center report suggests that the Milwaukee area — arguably the economic engine of the state of Wisconsin — already was vulnerable to the current recession, because it never really pulled out of the last one. Or the one before that.
The report shows median household income in the region not only hasn’t improved since 1980, it has actually declined when adjusted for inflation. And while the drop is steepest in the city of Milwaukee, households in Waukesha, Ozaukee and Washington counties have also been affected by this area-wide economic malaise.
The authors of the Lubar Center report — Mike Gousha, distinguished fellow in law and public policy, and John D. Johnson, research fellow — focused on household income, the dollars and cents brought in by all those who live in one place together. They compared median household income, a point evenly between a higher half and a lower half, and adjusted for inflation.
The researchers found that in 1980, the nation’s median household income was $54,000, with the city of Milwaukee checking in at $53,000.
By 2018, the last year for which data was available, the nation’s median household income had grown to $64,000 but the city’s household income had dropped to $44,000.
The more prosperous suburbs around Milwaukee continued to have household incomes above the national average during this stretch, but they also showed declines, reinforcing that the urban and suburban economies are tied to each other in one regional entity, not split.
More worrisome, the household income drop has been particularly acute since 2000. Median household income dropped $6,000 in the city of Milwaukee from 2000 to 2018. It dropped $8,000 in Waukesha County, $14,000 in Ozaukee County, and $13,000 in Washington County.
The report took note of the area’s racial disparity. The household income of a typical Black or Latino household was less than it was in 1980, while “white residents of the metro area fare significantly better.” Middleclass Black household income was particularly troubling, falling 20% during the last four decades.
“The question is, what are we as a community going to do about it? The dirty little secret is this community cannot be economically healthy, socially healthy, physically healthy as long as those kinds of disparities exist,” said Cory Nettles, the state’s former commerce secretary.
‘I feel like my options are limited’
For someone like Alisea Tate, working in health care is more than a job — it’s a calling.
Tate said she feels blessed to have job security, especially during the pandemic. “There will always be a need for nurses,” she said.
But it’s not without sacrifices. She has been working as a certified nursing assistant at Aurora St. Luke’s Medical Center for a little more than two years while working toward an associate’s degree in nursing. She’s on her mom’s health care plan, and lives on her own with her 2-year-old dog, Stormy.
The degree comes with a pay bump that she’ll need to pay back student loans.
Workers like Tate underpin the Marquette research.
Where once manufacturing dominated the local economy, the largest employer in the metropolitan area has become the health care and social assistance sector, accounting for nearly 19% of privatesector jobs.
The region has added 37,000 health care and social assistance jobs, with an average wage of $48,000. That’s $19,000 less than the average manufacturing job.
The one area where Milwaukee has seen exponential growth — managers of enterprises such as private equity firms — amounts to such a sliver of the overall employment picture that they have minimal impact on the household income data.
“The majority of our economy of our community has really been left behind. And Milwaukee unfortunately still has not figured out how to pivot from our manufacturing base of 40 years ago. We did not replace those manufacturing jobs with like jobs in the service sector.” Cory Nettles, Generation Growth Capital, Inc.
Even some people working up the corporate ladder don’t see a future for themselves in Milwaukee. Regina Newcomb, a middle manager at Northwestern Mutual with an MBA, said she feels like the higher she moves up in an organization, the fewer opportunities there are in Milwaukee.
“If I wanted to stay in Milwaukee and continue to have a successful career, I feel like my options are limited,” she said. There isn’t enough opportunity here to not consider looking elsewhere.
Not replacing lost jobs dollar for dollar
The past economic blows are well documented: a dramatic falloff in manufacturing that hit Milwaukee and the United States beginning in the late 1970s, combined with a double-dip devastating recession in the early 1980s. Then came a recession in the early 2000s followed by the Great Recession of 2008. And now the region and country are dealing with the economic chasm caused by the coronavirus pandemic.
What’s revealed in the Lubar data is that many comparable cities got back on their feet. Minneapolis, Indianapolis and Kansas City “all have added tens of thousands of employees to their economies since 2000,” the report said. Metro Milwaukee lost 6,200.
Nettles sees the region as a textbook “tale of two cities.”
“There are segments of Milwaukee that are booming, thriving and prospering,” said Nettles, founder and general partner of Generation Growth Capital Inc., a private equity firm that invests in advanced manufacturing companies across the Midwest.
“The majority of our economy of our community has really been left behind,” he said. “And Milwaukee unfortunately still has not figured out how to pivot from our manufacturing base of 40 years ago. We did not replace those manufacturing jobs with like jobs in the service sector.”
Nettles said the key is to “create the kind of jobs in our economy that get people back to, and above, where they were 40 years ago. And that means we have to figure out how to be better and smarter about the pivot from manufacturing to something else, the re-imagination of our economy, the focus of our economy with higher-paid jobs.”
The model for Milwaukee, Nettles said, should be a city like Pittsburgh.
When the old manufacturing jobs and steel industry gave way, Pittsburgh carved out an economic resurgence through health care, life sciences, higher education, research and advanced manufacturing.
Nettles said there needs to be collaboration between government, business and higher education to transform the region.
“Part of what you need is an overarching strategic plan, at the state level, at the city level, that points the way,” he said.
He said there are pockets of that modern economy, such as tech incubators and entrepreneurship hubs. But there needs to be more.
Arguing for a positive perspective
Tim Sheehy thinks all of this is not giving Milwaukee enough credit. Sheehy is president of the Metropolitan Milwaukee Association of Commerce, the region’s main business lobby.
In an interview and follow-up emails, Sheehy made clear he doesn’t believe the region’s economy is stuck in neutral. Instead, he sees a Milwaukee that has adapted to breathtaking change and has held its own.
“The story that Milwaukee is a city scuffling along isn’t true,” he said. “We have withstood massive global change within the sector — manufacturing — that has defined our history, is our primary economic driver, and is wound into our civic identity.”
He noted that 60% of Milwaukeeans were employed in manufacturing in 1910. Now, it’s around 15%.
“We’ve withstood that change and still rank in the top 20 for income,” he said, using per-capita income data for the four-county Milwaukee area as opposed to the household income figures used by the Lubar Center.
“We deserve a civic pat on the back for getting this far, not a story that Milwaukee is stale. ‘Why are we stagnating?’ The better question is how do we build upon what got us this far and what’s it going to take to remain in the top 20 for the next 50 years.”
Sheehy views a company like Milwaukee Tool as emblematic of the area economy, calling it a “company that symbolizes where we’ve been and where we can go.” Back in 2011, he said, the firm that develops and manufactures power tools employed around 300 people in the Milwaukee area. A subsidiary of Hong Kongbased Techtronic Industries Co. Ltd., Milwaukee Tool has expanded dramatically in recent years from its Brookfield headquarters, more than doubling its footprint in the region.
“Look at where they are today,” Sheehy said. “They’re close to 2,000 (employees in the region) and they have made multiple capital investments.” The average annual compensation of their employees in the Milwaukee area was $81,000, according to 2018 data reported by the company to MMAC.
Making sure the talent pipeline is filled is critical for the region, Sheehy said.
“If we can supply the talent that Milwaukee Tool is needing, they’re going to continue multiple expansions,” he said. “If we can’t, they’re going to find that talent elsewhere.”
He said it’s also vital that prosperity reaches all segments of the community, and that means raising income among Blacks and Latinos. The city of Milwaukee became majority-minority in the 1990s; the suburbs have been overwhelmingly white.
“About 34% of the population in the region are people of color,” he said. “In the next 15 years, maybe even the next decade, we’re going to become majority-minority, where people of color make up about 51% of the region’s population. That’s an asset.”
Bullish on the region
Charles Franklin, director of the Marquette University Law School Poll, said his statewide survey has shown a mixed picture on how people are viewing the current state of affairs, and the future.
“It’s really clear and sort of self-evident that when the shutdown-induced recession hit, we had a dramatic shift in how people see the current economy compared to a year ago,” he said.
In January and February, 48% of those surveyed said the economy was better than a year ago, and 17% said it was worse.
The most recent poll showed just 24% said the economy was better than a year ago, and 54% said it was worse.
Franklin said there is optimism about the future, “and that surprises me.”
“In January, 33% said we’d be better off economically in a year, 23% said we’d be worse, but the biggest group, 37%, said we’d be about the same,” the professor of law and public policy said.
And now? “Forty-five percent say it will be better in a year and just 13% say it will be worse in a year,” Franklin said. “And there are 22% who say it will stay the same.”
If that optimism is built on the assumption that COVID-19 will have run its course, that could change if the pandemic stretches out.
Nevertheless, Michael Perman, a Portland, Oregonbased futurist who grew up in Whitefish Bay, remains excited about the Milwaukee area’s prospects.
“Virtual work is here to stay,” he said and that “opens the door to new technology.”
He said there will be “new forms of customer service,” an expansion of tele-health, tele-surgery and robotics. “All have the potential to grow and are often good for workers,” he said.
He said there will also be a pent-up demand for what he calls “novel learning.”
“New virtual learning experiences that are truly engaging will grow,” he said.
He also spoke of the concept of “a regenerative society, which means putting more resources back into the world than taking out.”
“Climate change is going to impact Wisconsin and it’s important that people get aligned around that reality,” he said. “For Milwaukee, doubling down on water expertise is an obvious opportunity.”
Perman is bullish on the region. “Milwaukee has kind of an interesting combination of things, heavy industrial technical background, service industry, agriculture, water,” he said. “What happens when you pull those things together and think about regenerative society?”
But what that future looks like, tangibly, is yet to be determined.
Even Sheehy, plugged into the wider Milwaukee business community, admits his crystal ball can be “a little misty.”
And that’s OK, he said.
He likens the opportunities to something hockey legend Wayne Gretzky used to say.
“Don’t skate to where the puck is, skate to where it’s going to be,” Sheehy said. “From a policy perspective, and looking ahead, we’re trying to figure out where that puck is going to be in a decade.”
That’s a hard sell for people trying to find their American dream today.
Michelle Moldenauer felt like she was just starting to figure out where her life was headed. She had been working odd jobs since graduating from Ronald Reagan High School in 2016 but had finally landed on a career path. At 22, she was enrolled in classes at Milwaukee Area Technical College to earn her associate’s degree to become a welder.
Then the pandemic hit, and her plans to have a welding job over the summer between academic semesters collapsed.
Moldenauer wanted to save money to pay for more schooling, to move out of her parents’ house, to buy a car instead of borrowing her mom’s.
Now, she’s uneasy about how the plan she had set for herself will be warped.
“I try very hard to be hopeful,” Moldenauer said. “Part of me tries to be optimistic that we’ll come out the other side and will be better. The realist and pessimist in me thinks it won’t.”
This project is supported by a grant from Marquette University Law School’s Lubar Center for Public Policy Research and Civic Education to make possible journalism on issues of importance to the Milwaukee area. All the work was done under the guidance of Journal Sentinel editors.