Racine unemployment rate drops, pressure to build a skilled workforce remains

The extra push needed to spur employment in the City of Racine has started to take root as the unemployment rate dropped from 5.6 percent in July 2017 to 4.9 percent in July 2018.

This represents the biggest drop in unemployment among the 32 most populated communities in Wisconsin and is about twice the statewide decline of .3 percent over the same timeframe, according to a press release by Racine County and the City of Racine.

Read the City of Racine and Racine County’s joint press release on the unemployment rate.

This is good news for politicians, but a difficult challenge to overcome as the employment market has become increasingly competitive. To help alleviate the pressure, City of Racine and Racine County officials said more work needs to be done to move people from not working to working and getting people into higher paying jobs.

“The numbers show we are making progress on our goal to lift people out of poverty and make Racine a place where all residents have the opportunity for family-sustaining jobs,” said Racine County Executive Jonathan Delagrave. 

With Foxconn Technology Group, its suppliers and ancillary businesses expected to bring 22,000 jobs to Racine County, the need for workers is high. But a catch 22 exists within the region as thousands of workers in Racine County don’t have the necessary skills for higher paying jobs.

Read more: July unemployment rates decline in all Wisconsin metro areas over year.

“There’s a skill set that is missing, especially within manufacturing jobs,” said Jeff Sacshe, an economics professor at the University of Wisconsin-Oshkosh. 

Racine County’s hidden workforce

Wisconsin’s labor force participation rate remains at about 69 percent, which means more people of working age that could be working aren’t.

About 31 percent of the state’s workforce is choosing not to work. The labor participation rate includes college students, stay-at-home parents, people working part-time, and people on disability. 

This is a segment of the population that has typically flown under the radar for many employers. That’s why the city has targeted hundreds of unemployed and underemployed workers.

Racine Works, a program recently started by the city, received a $1.5 million from the Department of Workforce Development, the Gateway Foundation, and other sources to train people for higher paying jobs.

Through Racine Works, the City will partner with Racine County and other organizations and programs that are already training workers, including the Department of Workforce Development, Wisconsin Fast Forward worker training grant program, WRTP/BIG STEP, and First Choice Pre-Apprenticeship program.

Uplift 900 seeks to remove barriers to employment, which include not having access to transportation or a driver’s license, having a criminal background, access to good childcare, and unstable housing situations.

“We are encouraged by the progress we have made to connect our residents with the resources and training they need to attain family-supporting jobs,” said Racine Mayor Cory Mason. “We know the opportunities still exist, but it is our job, as a community, to make sure the residents of Racine are able to seize them.”

Another issue, according to the United Way of Wisconsin, is the number of people working at jobs where people cannot afford basic needs like housing, childcare, food, and transportation.

The social services agency calls this segment of workers ALICE, which is an acronym they use for people who are asset limited, income constrained and employed.

Total households in the City of Racine:		29,850
Poverty (%):		21%
ALICE (%):		35%
Above ALICE Threshold (%):		44%

“The latest report demonstrates the consistent financial hardship Wisconsin ALICE households faced from 2010 to 2016 and reveals the obstacles contributing to their financial instability. The report also details what has changed since Wisconsin’s first United Way ALICE Report was published in 2016,” according to the report.

Fixing Racine County’s employability problem

The tide for workers — at least in Racine County — is changing, but more so for people who have skills.

Racine County employers have been grappling with how to address a looming employment issue: The number of people retiring far outweighs the number of people entering into the workforce, said Kurt Bauer, president and CEO of the Wisconsin Manufacturers and Commerce (WMC).

“It’s a numbers game… simple math,” he said. “If you look at the birth rates, the workforce is dominated by Baby Boomers and the number of Millenials entering the workforces is big, but not here in Wisconsin,” he said.

To fix the problem, the WMC is tackling the issue from three different fronts: attraction, retention, and reintegration. 

The attraction strategy includes attracting more out-of-state workers through public relations campaigns in Illinois and Minnesota and increasing the number of foreign workers through the H1B visa program, which allows U.S. employers to employ foreign workers in specialty occupations. The WMC is also encouraging federal lawmakers to allow for seasonal worker program for people who are in the United States illegally, Bauer said.

“Right now the H1-B visa program caps the number at 80,000 for the whole country,” Bauer said. “I understand the need for security. But the program should also be needs-based and consider what our economy actually needs.”

With retention, employers are also working on programs that will keep and retain employees longer by focusing on improving wages, company culture, and benefits, Bauer said.

According to the latest quarterly data of employment and wages the U.S. Department of Labor Statistics published on August 16, manufacturing wages increased by 6.3 percent and construction wages increased 4.2 percent over the same time period last year.

“People will go where the work is interesting and the pay is the highest,” he said. 

And filling those jobs now requires an all-hands-on-deck mindset and that means employers are considering hiring people coming out of the prison system as well. That’s the third strategy, reintegration.

“This is a significant shift in hiring practices,” he said. 

WMC is working on recruiting employers that are sympathetic to hiring people coming out of the prison system as repatriated citizens.

“We need to rethink how we treat people coming out of the prison system,” he said. “Yes, this is someone who committed a crime. But they served their time and it’s a great opportunity to get on them on the straight and narrow.

“The best social program is a job.”

Question: Are you a business owner struggling to find workers? Racine County Eye is interesting in hearing your story. Please email Denise Lockwood at denise@racinecountyeye.com and put JOBS in the subject line.

2 Racine County job fairs look to be family-friendly events

Looking for a job or to hire someone? Check out our employment page.

---

Since you’re here…