Wisconsin warms to Poland
It might be known as America's dairyland, but the Midwest state of Wisconsin also claims the US' second-highest rate of workers employed in the manufacturing sector. With that in mind, you would expect Wisconsin's Governor, Jim Doyle, to discourage his state's manufacturing businesses from investing in Polish production facilities.
However, speaking in Warsaw last week as part of a three-country trade mission to Central Europe, Governor Doyle was anything but protectionist.
"In order for us to grow we must have companies in our state that are growing around the world," he said. "It's a good thing if a Wisconsin company finds a strong partner in Poland, or makes an investment in operations in Poland that adds strength to our economy in Wisconsin."
With average wages in the US around four times that of Polish workers, and benefit costs skyrocketing in the States, many companies are outsourcing in CEE. Delphi, one of the biggest employers in Michigan, Wisconsin's neigbor, recently declared bankruptcy, prompting fears of mass job cuts in the US, while at the same time investing in research facilities in Poland.
"I'm concerned about Wisconsin manufacturing going to Poland where the cost of labor is so much cheaper," Doyle said. "[However] we just have to compete better than we were competing before. We have to become leaner in our manufacturing [and] more productive."
He also believes Poland will not maintain its labor-cost advantage in the long term. "We're going to see over time that Poland's wages are not going to continue to be one-fourth of US wages."
Wisconsin and Poland's manufacturing sectors overlap in several areas, most importantly agricultural products and medical devices, but Doyle sees this as an opportunity for his state's businesses to grow. "If you take a Wisconsin manufacturing company that is making 10,000 widgets, and they expand so that they are now making 25,000 - 10,000 in Wisconsin and 15,000 in Europe or China - and the headquarters of that company continues to be in Wisconsin, that's a very good thing in Wisconsin."
