Pool of jobs or mirage?
Estimates vary widely on number of positions arena would create
When it comes to a new arena for the Bucks and jobs for Milwaukee, one thing is certain: Build a grand sports stage and at least a dozen well-paid NBA players will be working in the city.
But how many more jobs could the arena create?
The Bucks and Play It Forward, a coalition of groups backing a new arena and additional development in the Park East corridor, have been saying for months that the proposed $1 billion project would create 10,000 jobs over the next decade.
Updated projections are beginning to circulate.
An economic study requested by the Metropolitan Milwaukee Association of Commerce said as many as 2,100 permanent, non-construction, non-arena jobs could be created by the project. The study by a Marquette University economics professor is due for release Monday.
“Ten thousand jobs? It can’t be true. Once the construction phase is over, there is nothing new. All the Bucks are doing is changing the location of the building. How does it create new jobs? We’ve been over this. It’s the same tired argument.”
Robert Baade, a sports economist at Lake Forest College in Illinois “There will be a range of jobs going from minimum wage to six figures. As a community we have to say, ‘Let’s get people on the ladder and moving up the ladder.’ ”
Cory Nettles, Bucks investor and a former state Department of Commerce secretary
Meanwhile, Building Advantage, which promotes the union construction industry, makes the case that the arena and development project may translate into more than 14,000 jobs, with more than half of them coming in construction.
Skeptics scoff at such projections. They say that the number of permanent jobs will be far less and that many of the construction jobs, both for the new arena and anticipated development nearby, would be temporary in nature.
The promise of jobs involving the construction of stadiums and arenas is not a new debate.
On one side are economists who say publicly financed sports arenas do not provide a positive economic impact to cities and do not increase employment.
“Ten thousand jobs?” said Robert Baade, a sports economist at Lake Forest College in Illinois. “It can’t be true. Once the construction phase is over, there is nothing new. All the Bucks are doing is changing the location of the building. How does it create new jobs? We’ve been over this. It’s the same tired argument.”
On the other side are arena and stadium proponents who say a project like what the Bucks have in mind — an arena plus ancillary development — is a winning formula that will add jobs and enhance economic development.
“There will be a range of jobs going from minimum wage to six figures,” said Bucks investor Cory Nettles, a former state Department of Commerce secretary. “As a community we have to say, ‘Let’s get people on the ladder and moving up the ladder.’ ”
Team spokesman Jake Suski said, “Our owners’ vision around this project from day one has been more than just to build a world-class arena in downtown Milwaukee, but to invest in the potential of this community so that the Bucks can become a catalyst for economic opportunity and growth.“
Claims made elsewhere
Just a look around NBA cities shows that job claims are often part of a push to get a new arena.
In Sacramento in 2014, Mayor Kevin Johnson broke ground on a new downtown Entertainment and Sports Center and said the project would create 11,000 construction jobs and 4,000 permanent jobs. The arena is due to open in 2016.
Politicians in New York crowed that the Barclays Center in Brooklyn, which opened in 2012, would lead to more than 10,000 jobs.
The Bucks want to build a $500 million arena they hope will spin off an additional $500 million in the form of new office space, residences, bars, restaurants and a large public plaza that Bucks coowner Wes Edens hopes will be the biggest outdoor sports bar in the country.
For months, the Bucks have touted the 10,000 jobs over a decade claim. The Commercial Association Realtors Wisconsin, a trade group, has gone even further, saying the project will exceed 10,000 jobs.
The BMO Harris Bradley Center already employs a little more than a 1,000 people annually. Around 10% of the workforce is full time, with the rest part time. The payroll and benefits of the workforce run $9 million or more a year, said Steve Costello, president and CEO of the BMO Harris Bradley Center.
It’s believed there would be a larger workforce in a bigger, busier building.
In his report requested by MMAC, Anthony Pennington-Cross, Marquette University department of finance chairman, created long-term, non-construction job projections. He based his figures on the proposed arena development, which is planned to be built in stages.
He came up with an estimate of 2,107 jobs — 1,422 office workers, 594 in retail, 55 for a Bucks practice facility and 36 to work in the apartments to be built on the site.
“I think the estimates are pretty conservative, especially in the office employment,” Pennington-Cross said in an interview. “The key is the offices have to get occupied.”
Pennington-Cross said a major feature in the project is that the arena would be blended into the surrounding area, unlike the BMO Harris Bradley Center.
“Successful arenas, like the one the Bucks are proposing, become part of the fabric and identity of the areas in which they reside to create a live, work, play environment,” Pennington-Cross wrote. “The Bucks arena redevelopment plan provides an opportunity for an important and valued amenity that helps Milwaukee compete for a highly mobile, highly educated, creative workforce to attract future companies to the region.”
‘Reshuffles the spending’
Of course, not everyone buys the notion that arenas can ignite new economic activity.
Heywood Sanders, a University of Texas at San Antonio economics professor, is a frequent critic of backers of expanded convention centers and new sports palaces who say the projects will create jobs and economic activity.
“The notion that an arena in and of itself where a team is already playing will generate a boost in development is a mirage,” he said. “When folks say something like 10,000 jobs over 10 years, those are construction jobs. That’s not the issue. It’s what you bring in terms of longterm permanent jobs. And even if there is a commitment of jobs, it’s still subject to the vagaries of the market.”
Baade, the sports economist, said there is hope that anticipated ancillary development can help the job picture. But it has to be planned well. Even then, things may not pan out.
“People going to bars and restaurants are the same people going to Bucks games now,” Baade said. “They’re going to bars near the BMO Harris Bradley Center now. It just reshuffles the spending.”
Robert Leib, who runs an economic and financial consulting firm in Mequon and who has been a supporter of public financing of stadiums and arenas, said the Bucks’ plan would create jobs.
“The job count spikes during the construction period and then levels off with a stabilized job count,” he said. Don Walker reported on the prospect of a new downtown arena and related development under a fellowship established through Marquette University Law School’s Sheldon B. Lubar Fund for Public Policy Research. All the work was done under the direction of Journal Sentinel editors. Don concluded much of the reporting and writing for this story before he died May 22. Journal Sentinel colleague Bill Glauber completed the work for publication.