During what the media dubbed the Great Recession, a dark cloud seemed to loom over nearly every community as they battled against higher unemployment, falling property values, soft retail sales, reduced visitor and business travel and more. Wisconsin’s Fox Cities region was no exception.

But in every cloud there is a silver lining, and this region definitely found theirs. While the rest of the nation saw unemployment rates climb as high as 11+ percent, the Fox Cities’ hovered around nine percent.

Bob Jakel, president of the Fox Cities Economic Development Partnership, attributes this to a resilient and forward-thinking manufacturing base that took a “can do” approach rather than a “woe is me” stance to the recession. As a result, they found growth opportunities even as traditional markets, such as the auto industry, shrank at a rapid pace.

“We did not lose as many manufacturing jobs as the rest of the nation,” Jakel says. “The overall impact was bad, but it wasn’t devastating. Our manufacturing base is very adaptable.”

The region possesses a strong ability to weather an economic storm, agrees Chris Linn, vice president of marketing and business development at Bassett Mechanical, a Kaukauna-based, full-service mechanical contractor. “We have a lot of highly skilled people. We’ve got some really innovative companies competing on a global basis,” he says. “Because of that work force and that type of innovation, our manufacturing base can quickly adapt to changes in the marketplace.”

As the recession took hold, this region’s forward-thinking companies harnessed their existing skills and equipment to produce components for new markets. For example, companies traditionally manufacturing automobile components started making parts for the wind turbine or hydro industries. These moves kept job loss down.

Bassett Mechanical, for instance, unearthed a new niche in renewable energy about five years ago. That niche market, combined with its work in industrial refrigeration, helped the company navigate the recession, says Linn. The company, which also specializes in helping firms reduce energy footprints, is now seeing an upswing in renewable energies business. Linn attributes the upswing to new mandates requiring states to produce 15 percent of their electrical energy from renewable sources by 2015.

As the economy stabilizes, more companies are starting to rally; hiring back employees and increasing overtime, says Jakel. “We still lack the confidence we had eight or nine years ago, but we are on an uptick,” he says.

Light at the end of the tunnel

Fond du Lac represents one community hard hit during the recession, with unemployment rising from 4 to almost 11 percent. But Joe Reitmeier, president and CEO of the Fond du Lac Chamber of Commerce, sees light at the end of the recessionary tunnel.

“While we saw many companies cut their labor force in half to stay competitive and survive, we also welcomed new firms, which is unique in this economy,” he says.

According to Brenda Hicks-Sorenson, president of the Fond du Lac County Economic Development Corporation (FCEDC), three attraction clients opened facilities in 2009. Wausau Equipment opened a 22,050 square foot research and development facility in the Aeronautical Industrial Park; Chicago Tube & Iron opened a 117,000 square feet facility in Fox Ridge Business Park; and McNeillus Steel launched an operation in the community’s Southwest Industrial Park. The trend continues as Central Wire purchases the vacant Charter Steel building for a Wisconsin operation.

“Of these four businesses, two are new to Wisconsin and the other two represent significant expansions within the state,” says Hicks-Sorenson. “We’ve been very fortunate and blessed to see continued growth and opportunities during the recession.” She adds the FCEDC served 235 businesses in 2009, representing a 26-percent increase over 2008.

A near miss

These successes could have easily gone the other direction had the community lost its largest employer, Mercury Marine, a manufacturer of outboard motors and MerCruiser inboard engines. The company, which employed 1,800 area residents, announced plans to possibly relocate its Fond du Lac operations to Stillwater, Okla.

Area government and business organizations knew if they were going to act, they needed to act quickly — the loss of this company could have been disastrous to the area. A study released in August predicted the loss of up to 8,000 jobs. This number included job losses at Mercury Marine as well as at approximately 250 local companies supplying the firm.

An FCEDC study estimated the loss of this significant sewer and water customer would up local residents’ water and sewer rates by 5.5 percent. The report estimated the average property tax bill would initially raise property tax bills by $20, but the longer the facility sat vacant, the higher that impact would be. “We also calculated a 5-percent decrease in overall property values, which was really, really conservative,” says Hicks-Sorenson.

Local government and business organizations met with Mercury Marine officials to see how they could help. It was decided to loan the company money. The county government considered a wheel tax, where the county tacks on an additional $100 per vehicle registration; a property tax hike; or a half-percent sales tax to fund the loan. “We decided the half-percent sales tax would have the least impact to residents,” says Hicks-Sorenson. In fact, the Wisconsin Department of Revenue estimates non-residents will fund approximately 22 percent of the sales tax.

The sales tax, which went into effect April 1, will not only help Mercury Marine, but will also better the entire community, says Hicks-Sorenson. The new levy should collect between $6.5 and $7.5 million annually, and about $3 million will remain after paying debt service on the Mercury Marine loan. This money will fund a $500,000 revolving loan fund administered by the FCEDC for companies seeking additional funds to expand.

County administration also expect the surplus will fund property tax relief and economic development initiatives. For example, the money might pay to tear down a dilapidated building then prepare the site for development. “No one wants to incur the cost of tearing down an old building,” Reitmeier says. “These funds could come in and literally save the day. They can provide us with opportunities that didn’t exist before.”

Building business travel

The minute the recession hit, business travel to the Fox Cities fell and conference attendance slowed, says Lynn Peters, executive director of the Fox Cities Convention & Visitors Bureau.

“As soon as times get tough, business clamp down on business travel; they send one person instead of five or meet via conference call instead of in person,” she says.

They saw an opportunity emerge as more Wisconsin residents opted for “staycations” versus lengthier, out-of-state getaways, and created “The Fun is On Us” program and allocated $60,000 to fund it. The program provides $50 gift cards to visitors choosing the Fox Cities for a getaway weekend. Area hotels further sweetened the pot with incentives of their own.

“The program was a resounding success,” says Peters. “We sold 500 packages and filled up a lot of hotel rooms.”

She adds the program also highlighted the bureau’s support of the business community. “At a time when everybody felt quite adrift, it made everyone feel like we were really working together,” she says. “When people stay in hotels, they also shop, eat in our restaurants, and even put money in our parking meters. If they don’t ever come to our community, they don’t spend any of that here.”

Booming enrollments

Fox City colleges are also experiencing an upswing as the unemployed retool their skills to make them more employable and the employed add skills to keep their jobs, says Dr. Susan May, Fox Valley Technical College president.

“Our enrollment skyrocketed this year, unlike we’ve ever seen in our history,” she says. “We had roughly a 15-percent increase in student enrollment in our core occupational programs, on top of a 6-percent increase in 2008. When we’re having a good year, in a typical time, we’d see about a 4-percent increase.”

The college began offering some classes almost around the clock to meet increased demand. The addition of night and weekend shifts for welder training, with courses running from 9 p.m. to 2 p.m., is one example. They also offered more class sections in high-demand course areas and hired additional faculty to handle the increased course loads.

In recent years, Fox Valley Technical College also added initiatives designed to help budding entrepreneurs launch new businesses. The college’s Fabrication Lab, opened two years ago, helps early-stage entrepreneurs fabricate product prototypes.

“Oftentimes people do not have access to these types of services,” May says. The Fab Lab maintains the software, tools and experts to help inventors fabricate new products. To date, the lab has made more than 150 prototypes.

The college’s Venture Center offers short-targeted programs for businesses in various stages of development. They help business owners write business plans, navigate financing issues and more. One of the program’s successful ventures brought HuHot Mongolian Grills to Wisconsin.

In times of trouble, it’s easy to duck your head in the sand and wait for it to pass. But sometimes the silver lining is one you need to look for. The Fox Cities region looked for its silver lining and found it in new businesses and initiatives that have left the area well poised for future growth.

By Ronnie Garrett

Ronnie Garrett owns and operates Garrett & Co. Studios, a Fort Atkinson company providing editorial, photography and graphic design services.

More Featured Articles