(Rock County, WI) The Janesville-Beloit MSA economy posted another solid quarter, as strong consumer and investor confidence continued to drive activity throughout the county. These trends are highlighted in today’s release of the Q2 2021 Rock Ready Index.
The trendline for the area’s average unemployment rate remained relatively steady-to-declining, albeit exhibiting incremental shifts of a few tenths of a percentage point. By way of quick history, if this holding pattern continues, the year-end averages will look very similar to those rates from 2015 – where local and federal rates locked in the five-percent range, and the state flirted with a rate of four-percent. What is different from 2015, though, are the number of active job postings that populate the employment boards. During the first half of 2021, the JobsInRockCounty.com site has averaged more than 425 job postings per month. These postings are not just entry-level positions. Furthermore, there’s definitely an uptick in the number of postings for high-skill, in-demand jobs.
According to economists, this trend is caused by the combined impacts of new business processes and operations that were deployed during the pandemic; and because there are fewer folks actively participating in the workforce. While much has been written or opined about the skills gaps and workforce shortages, the solutions to this dilemma are quietly emerging. To scale, as well as to sustain, these multi-faceted solutions properly will most certainly require a collaborative, grassroots strategy that is laser-focused on youth and talent pipeline development activities.
Housing prices continued their upward movement, as Q2 set new, all-time records for both Average Sale ($231,706) and Median Sale ($209,500) prices, respectively. While nationally home sales and permit numbers are beginning to taper down, the local trendlines are moving in the opposite direction. For example, Q2’s new housing starts are about 10% higher and sales are nearly 14% above what was recorded during the same time period a year ago. Although lumber prices are slowly declining – they’re still high. Plus, the costs associated with other building materials and supply chain constraints for fixtures and appliances are causing heartburn for the entire housing industry. Despite these challenges, the 2021 emerging housing markets index released by the Wall Street Journal and Realtor.com notes the Janesville-Beloit MSA ranks quite competitively among its 300 MSA peer locations. Depending on the month and methodology applied, that index ranks the area among the Top 50 or Top 100.
The County’s sales and use tax collections for Q2 ($4.89 million) established a new benchmark, posting a 24% increase from Q1 and more than a 47% gain from a year ago. While there’s no debating the impacts of the federal stimulus dollars that flowed directly into taxpayer accounts, consumers have been consistently exercising their local buying power. Case in point: collections during the last decade have been increasing by about five-percent every year. Considering the second half of the year generally outpaces the first half, 2021 is poised to set yet another annual record. How consumers adjust to rising inflationary pressures, though, will ultimately determine their spending patterns – particularly for discretionary goods or services.
The economic development pipeline remained well-stocked, as investment activities associated with food and metal fabrication manufacturing, as well as logistics, remained strong. This trend is consistent with national activities too, as the Manufacturing Purchasing Managers’ Index (PMI) recorded an average PMI rating of 61% for the first half of 2021. A PMI reading of 50% or more serves as an industrial expansion indicator. Couple that indicator with the volume of Letters of Intent and/or Purchase & Sale Agreements that are currently active throughout the Janesville-Beloit MSA, more developments are definitely on the horizon.
Those factors, as well as other market-related considerations, were the drivers behind the June 2021 Spray-Tek announcement. As one of the largest custom, contract specialty ingredient processing manufacturers in the U.S. Spray-Tek needed a Midwest location to optimize its customer and supply chain relationships. As a result, the company has planted its flag in Beloit’s Gateway Business Park.
The Rock Ready Index (RRI) is a quarterly economic development dashboard compiled and distributed by the Rock County Development Alliance. The RRI covers four topical areas: Workforce (Job Postings and Unemployment Rates), Real Estate (Residential, Commercial or Industrial) Trends, Sales (Tax Collection) Activities and a snapshot of the ED Pipeline's growth and/or investment opportunities. Each Index also includes a Project Profile section, which highlights project-specific news during a given quarter. For more information, visit www.RockCountyAlliance.com.