Rankings show that Dane County has the second-highest GDP growth among Wisconsin counties. It’s one of multiple indicators that show the economic health of the county, experts said this week, which extends beyond the public economy associated with the university and state government.
“Looking at the GDP growth is an important refutation of a common misperception of Dane County, which is that our economy is driven by the public sector,” said Zach Brandon, president of the Greater Madison Chamber of Commerce. “There’s this misnomer that Madison is all public sector jobs, and in reality it’s not.”
Brandon said that 74 percent of Dane County’s economic output comes from the private sector, a fact that is highlighted in GDP reports.
According to the rankings, Milwaukee County ranked first in GDP growth, with Dane County behind at number two. Milwaukee had $1,557 million in GDP growth for a growth index of 4.46, while Dane County showed $1,091 million in GDP growth with a growth index at 3.42. Waukesha and Brown counties were the next highest counties on the list.
GDP, or gross domestic product, is the total dollar market value of goods and services produced over a specific period of time. GDP growth measures how fast an economy is growing.
The rankings were compiled by SmartAsset, a financial technology company based in New York. It looked at real growth in the local economy, adjusted for inflation, over four years.
Low unemployment rates in Dane County are sometimes attributed to the presence of the state government and the University of Wisconsin-Madison. Rankings like this show that Dane County’s private sector has accelerated over the last decade and is currently thriving, said Paul Jadin, president of Madison Region Economic Partnership (MadREP)
“There’s no question that we have grown well beyond state government and the university driving the Dane County Economy,” Jadin said. “It’s clear the private sector has taken over, as evidenced primarily by the growth of Epic.”
Dane County's healthy GDP growth can be linked to unique target sectors, Jardin said.
“Life sciences and information technology set us apart,” Jadin said. “It comes out of a very strong relationship with business and University of Wisconsin.”
Jadin said there are also strong advanced manufacturing and healthcare sectors, and agriculture is just as strong in Dane County as it is anywhere else in the state.
While significant GDP growth is a positive sign, it doesn’t provide a complete picture of the economic health of a county, Jadin said, as cities with the highest populations tend to rank the highest in GDP growth.
“GDP growth is a product of how big you are, and that’s why Milwaukee is ranked number one,” he said.
While Milwaukee County may lag on other metrics like business growth or new building permits, its absolute GDP growth is high because it has a large population, he explained. Jadin said it’s important to look at metrics like the number of businesses and startups, or even the ability attract and retain students at universities. MadREP tracks 32 such metrics on its website.
Jadin also said MadREP doesn’t tend to compare Dane County to other Wisconsin counties, but rather to growing cities around the country like Austin, Raleigh and San Francisco.
“We think we should be comparing ourselves with the best nationally,” he said.
The Greater Madison Chamber of Commerce spends significant time looking at national rankings, Brandon said. He agreed that while GDP growth is a “time-honored and tried and true methodology for analyzing economic health,” he said “it’s just not as laser-focused on what we believe drives economies.”
Brandon said the chamber looks at data put out by the Brookings Institution concerning advanced industries, which are defined by 50 sectors that the institution has identified as driving the national economy. The sectors are united by significant research and development investment in the STEM fields — science, technology, engineering and math — and include manufacturing, energy and health technology, Brandon said.
From 2013 to 2015, Madison was ranked 11th among the 100 largest U.S. metropolitan areas in job growth within these industries.
These indicators are encouraging and it looks like Madison’s economic vitality will be a long-term trend, Brandon said.
Jadin was similarly satisfied.
“This is a very healthy economy here and we’re very pleased with the way we’ve been growing,” Jadin said.