A new national report shows Wisconsin surviving the recent economic downturn far better than other states.

Unfortunately, many middle class families are also suffering devastating hits to household income and savings.

Wisconsin had the second-best score in a new “Economic Security Index” (ESI) from the Rockefeller Foundation. Only New Hampshire ranked better.

But the report notes a worsening trend in the United States, with one in five families now living with "economic insecurity," meaning they have lost employment income or seen savings disappear.

"This trend disproportionately affects the less advantaged, but has risen substantially for all Americans," the report says.

The index measures the number of families who have lost 25 percent of their income over a given period of time. It doesn't spell out particular details -- such as whether the losses came from losing a job or taking a cut in hours -- but rather counts the percentage of households who've experienced big hits to their finances.

Wisconsin had a 15.9 ESI from 2008 to 2010, the latest numbers available for the Rockefeller survey. That means nearly one in six households in the state saw their annual incomes fall by at least 25 percent.

Wisconsin’s peak ESI score was 17.7 percent in 2007. The national average peaked in 2009 with an ESI at 20.5.

“The great recession was both broad and deep. No part of the nation was spared,” says a statement from Jacob Hacker, director of the Institution for Social and Policy Studies at Yale University, who helped write the study. “Nonetheless, some states weathered the downturn better than others, and Wisconsin was among them.

"That Wisconsin did better than average, however, does not mean it did well."

Indeed. The ESI for Wisconsin has risen by 44 percent between 1986 and 2010, reflecting a broader national decline in economic security over the past 25 years.

Laura Dresser, a researcher with the Center on Wisconsin Strategy, says the report is hardly good news, even if it shows Wisconsin doing better than other states.

“Everybody is on the same escalator going down, but Wisconsin started in a much better position,” she says.

Dresser notes that Wisconsin has historically scored well on income equality measures, meaning the gap between richest and poor is not as wide as other states.

Wisconsin also has lower concentrations of individuals considered most at risk. For example, large income losses are most prevalent among households headed by someone who has less than a college degree or is black, Hispanic or a single parent.

“This report just emphasizes that Wisconsin has been protected in many ways by having a better middle class,” says Dresser.


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