Building for the
FUTURE

Economic Summit II to continue thought-provoking discussion of Wisconsin's New Economy

By Susan Trebach

What a difference a year makes.

Last year, the state's economy was humming along quite nicely, and some skeptics wondered why the UW System was even sponsoring the first-ever Wisconsin Economic Summit.

Now, with Wisconsin's economy struggling, the interest is enormous in Wisconsin Economic Summit II, scheduled for Nov. 26-27 in Milwaukee.

With Summit II, the UW System is turning the spotlight once again on critical economic development issues, tracking progress on those issues since last year's Summit, and moving to develop an action plan to enhance Wisconsin in the New Economy.

"One year after the first Summit, we are poised to move to the next stage--identifying and selecting the superb ideas from the simply good ones, and finding the will and the resources to pursue the most promising leads," says UW System President Katharine Lyall.

Despite the economic downturn over the past year--a trend exacerbated by the Sept. 11 terrorist attacks--much has taken place in Wisconsin to move the state's economy from agriculture and manufacturing to developing the high-tech companies and jobs of the future.

Gov. Scott McCallum in October announced several economic development initiatives. They include accelerated programs to help displaced workers, new incentives to assist new and existing businesses, a strong push for consumers and state agencies to buy Wisconsin goods, and an increased focus on his energy plan.

The Legislature is also in high gear with respect to economic development. The 2001-2003 biennial budget contained a number of measures intended to expand the workforce, encourage university research and technology transfer, and to improve the regulatory climate.

The UW System's Economic Stimulus Package, a major budget initiative, sharply increases student access to course areas considered vital to the state's economy. By next fall, there will be more than 2,500 additional UW students enrolled in biotechnology, computer science, engineering, telecommunications, and other key areas.

The biennial budget also funded new faculty positions to increase course offerings and research in areas of economic importance such as e-commerce, technology and design visualization, molecular imaging, environmental hazards and biomedical engineering.

"The Legislature and Governor McCallum expressed their trust in the UW System by providing significant funding for the Regents' Economic Stimulus Package in the 2001-03 biennial budget," says Board of Regents President Jay Smith. "Now it's our turn to stand and deliver, and we will. Summit II will be a major event for us in that regard."

While the New Economy continues to evolve in Wisconsin, it is important to review the progress made since the first Summit. What follows is a summary of major developments in the state's economic arena since last November.

Investing in Wisconsin's Entrepreneurs
One message repeated loudly and often at last year's Summit was the need for more investment capital in Wisconsin--particularly venture capital for high-risk start-up companies. A recent study by NorthStar Economics compared the amount of venture capital raised in each state, relative to that state's population. Wisconsin, at $21 per person, does not come close to the national average of $72 per capita.

At last year's Summit, then-Lt. Gov. Scott McCallum addresses the crowd. As governor, McCallum is one of the featured speakers for Wisconsin Economic Summit II. UW System/Kevin Boatright.

Despite the economic slowdown, there have been some promising signs in terms of investing in Wisconsin's entrepreneurs:

• Angel investor networks, which finance the earliest stages of businesses, have formed groups across the state, and McCallum held the state's first Summit on Venture Capital.
• The state Department of Commerce took 14 Wisconsin start-up companies to Boston in May to seek venture capital, and conferences focused on building Wisconsin's biotech community and life sciences venture opportunities were held as part of the Midwest Biotechnology Conference in October at Madison.
• Sen. Gwendolyn Moore, D-Milwaukee, and Rep. David Ward, R-Fort Atkinson, introduced legislation in October to make an additional $100 million in venture capital available to small Wisconsin companies under the Certified Capital Company (CAPCO) program. Created in 1998, the program originally authorized $50 million in venture funds created through providing tax credits to insurance companies. If passed, the legislation would triple the size of the program.
• The Wisconsin Technology Council, a public-private partnership of business, government and education formed at the first Summit, is paying close attention to the issue.

Workforce Development
Of course, even with plentiful investment capital, Wisconsin companies will find it difficult to grow jobs in the state if they don't have skilled workers to fill them. And the perception of at least some skilled workers is that the best jobs are not plentiful here.

A Wisconsin Policy Research Institute study of UW-Oshkosh graduates, issued in August, suggested that those who leave Wisconsin make more money than those who stay. The study showed that Oshkosh alumni with full-time jobs in Wisconsin earned an average of $51,000 a year, while those who moved to other states averaged nearly $63,000 a year in income. Oshkosh alumni in science- and math-related fields were also 50 percent more likely to leave Wisconsin than other grads, according to the study, heightening the perception of a brain drain of our most marketable workers.

The Wisconsin Alumni Association estimates that roughly 20 percent of UW-Madison's in-state students move out of state within seven years of graduation. WAA is ramping up its efforts to attract alumni back to the state, primarily by promoting an online resume bank, called e-ProNet, to match talented alumni with Wisconsin companies.

The UW-Madison School of Business, working with 13 career center offices across the UW System, has also developed an on-line job network. Known as "Wisconsin Jobs for Wisconsin Grads," the program is free of charge to all UW System students and alumni and to employers.

An Overarching Strategy for Education
While educational and training programs spring up around the state to meet present and future demand, there is clearly a need for an overarching, collaborative group that can identify educational gaps and address them comprehensively.

Nearly 1,000 government officials, business and non-profit leaders, and education professionals attended last year's Summit at the Midwest Express Center in Milwaukee. A similar crowd is expected for Wisconsin Economic Summit II. UW System/Kevin Boatright.

Such a group came into existence this year. The statewide PK-16 Leadership Council, co-chaired by Lyall and Elizabeth Burmaster, state superintendent of public instruction, is a voluntary policy group. The Department of Public Instruction, the Wisconsin Technical College System, the Wisconsin Association of Independent Colleges and Universities, the UW System and important educational constituent groups are all represented on the council.

Initially, according to Lyall, the council has focused its time and energy on three critical areas: early childhood development; the senior high school year and transition to college; and professional development of teachers.

Improving the State's Infrastructure
Several steps have been taken to address Wisconsin's energy needs, a key recommendation from last year's Summit:

• Governor McCallum unveiled a new energy plan, calling for adding 6,300 megawatts of electrical generating capacity over the next 15 years and doubling the use of renewable fuel sources by 2010;
• The State Public Service Commission approved construction of the proposed 240-mile transmission line between Duluth and Wausau;
• A journalism consortium, "We the People/Wisconsin," is focusing on Wisconsin's energy future.

Transferring Technology
Without a doubt, the biggest Wisconsin technology transfer story of the year has been UW-Madison biologist James Thomson's research on human embryonic stem cells. The technology took center stage this year when President George W. Bush agreed to fund research on existing stem cell lines.

Thomson, who appeared on the cover of Time magazine as "the man who brought you stem cells," and the Wisconsin Alumni Research Foundation, UW-Madison's non-profit independent patenting organization, made international headlines.

While stem cells took center stage, there were a number of other milestones on the road to transferring Wisconsin research to commercial application.

• Formation of the WiSys Technology Foundation, Inc. Formed shortly before the first Economic Summit as a WARF subsidiary and housed at UW-Milwaukee, WiSys offers patenting, copyright, trademark protection and commercialization services to UW System faculty. At least a half-dozen faculty and staff ideas have been accepted for patenting and licensing.
• In August the UW-Madison University Research Park opened an additional 51,000 square feet of incubator space to accommodate new biotech start-up firms. The Park has also acquired another 113 acres in the Town of Middleton for future expansion.
• UW-Milwaukee, Marquette University, the Medical College of Wisconsin, UW-Parkside and the Milwaukee School of Engineering are jointly creating TechStar with the support of the Metropolitan Milwaukee Association of Commerce. TechStar will be a catalyst for starting high-tech businesses in southeastern Wisconsin.

Wisconsin's Image

At the first Economic Summit, public relations executive Marsha Lindsay caused quite a stir by suggesting that Wisconsin launch a new branding campaign beyond beer, brats and cheese.

Since Lindsay's wake-up call, many people have begun to think about Wisconsin's image and the potential for enhancing it. And some have begun to actually do something about it.

Image improvement is a top priority of a steering committee of Spirit of Milwaukee, Inc. The organization is commissioning a study of nationwide perceptions of Milwaukee, and it plans to launch positive public relations and advertising campaigns.

Meanwhile, the leaders of nine Milwaukee-area colleges and universities are joining forces in a marketing campaign to promote the benefits of going to college in Milwaukee.

In addition, Forward Wisconsin is commissioning public perception studies, the Wisconsin Technology Council is contemplating strong recommendations in this area, and the new competition to design Wisconsin's quarter for the U.S. Treasury will have an enormous impact on how the Badger state is perceived by the rest of the nation.

Looking Forward
Summit II is going to cast an eye on what Wisconsin's Upper Great Lakes neighbors are doing in pursuit of economic development, according to Regent President Smith.

"We will examine the cluster model for economic development and take the temperature of our entrepreneurial climate," Smith says.

Moreover, out of the next Summit will come the beginnings of an action agenda, promises Smith.

"We will take our best ideas and fashion some strategies for the public to consider," he says.