Wisconsin's unemployment rates, it's at 3.5 percent.
That's lower than the national average.
But for people newly entering the job market, like recent graduates, what are their prospects?
Is the labor market cooling and what role does AI have?
That's a lot of questions.
We take them to Scott Hodeck, economist with the State Department of Workforce Development.
And thanks very much for being here.
Yeah, absolutely.
Thank you.
So what does the Wisconsin labor market look like right now for new entrants into it?
Well, the first thing I would say is that we're responding to the national trend, which
is a cooling economy, like you noted.
We've been seeing gross domestic product drop from 2.8 percent in 2024 to 2.2 and 2025.
And then so far in the first quarter of 2026, we're at 1.6.
So we are seeing, we're seeing some deceleration, some slowing at the national level.
And you know, a couple of that with rising prices, which are a real drag on the economy.
And some of the other indicators that show some changing spending patterns and flattening
trend and real disposable income, savings rates, things like that.
And we're definitely seeing then a slowing national economy.
And of course, then in Wisconsin, we feel that as well.
When I look though at our overall labor market, there are some bright spots too.
I mean, like you noted, we do have a historically low unemployment rate.
So if you look at, say, national job openings data, you do tend to see that the higher rates
and the separation rates tend to be really tight together.
But they're still, you know, relatively speaking, a decent amount of openings.
So it's, while we have slowed, there are still openings out there.
And we've had plenty of times in the past where we've had, you know, technological change.
And that definitely does cause some disruption, whether that be in some shifts in businesses
as they figure out how to, how to kind of change occupations or what they're looking to
hire in terms of skills, but also for then the new grads and the workers themselves,
as they're trying to decide, well, what skills do I need?
And how do I get into the labor force at this point?
And it's always a little bit tricky graduating as the market's cooling.
I mean, I did that myself forever ago.
And it is a little difficult, but students and new grads adapt.
And that's what's always happened in the past.
Now, the question with AI is often, well, are we going to see a situation where AI substitutes
for so many jobs that we see something we've never seen before?
And I can't really answer that.
We just, we don't have enough data and we don't, everything we see out there, you see
one thing one day, one thing in the next.
And so while this is something that the Department of Workforce Development is aware of, and
we've actually done work for the governor's task force on AI and looked into where there's
exposure amongst these occupations to AI, and there's a lot.
There will be a lot of exposure, but it doesn't necessarily indicate substitution.
In a lot of cases, it will be folks working with AI.
And that's something we're already seeing.
And so at least right now, what we're seeing in the data is that it has been a little
tougher for new grads to find work.
That's not unusual, like I said, in a down period, but we are seeing some indications
that there may be some other things going on there.
But that said, new grads have always adapted and there are a lot of job openings out there.
And given demographics, just with the retirement of the baby boomers, there are a lot of positions
coming open that are simply because of retirements.
So there actually are a lot of openings and opportunities out there.
It's just a matter of kind of connecting to them.
What are the so-called hot jobs right now?
Yeah, a couple of the industries, and again, so I'm going to base this off growth, but
we're seeing a lot of growth in healthcare, and that makes sense with an aging population,
but also with retirements.
And we're seeing a lot of growth in construction as well.
And you might look at construction and say, okay, well, that's mostly manual labor.
And there is a lot of that, but it's not always the case as well.
There's skilled trades like electricians and plumbers, there's machine operators.
And then you've got the larger companies that do require accountants and ITs.
So you do have a lot of different occupations mixed in these fields that have been doing
well.
But also, if you look at manufacturing over the last few years, it's been a downward trend
in employment.
And honestly, throughout the past decades, we've seen staggered drops in employment in
manufacturing, which we've seen nationally as well.
This is kind of a developed world sort of trend.
But what we do see is that there's still difficulty hiring into manufacturing as well.
And we're looking at a ton of employment in Wisconsin and a ton of output and contribution
to our gross domestic product here.
So there are a lot of positions there that are open as well.
But we don't necessarily think about that sometimes as job seekers, like, is this industry
growing?
If not, should I not apply there?
And the truth is, there's so many retirements across a lot of these different industries
that it's more a matter of thinking of finding kind of the occupations that fit, right?
So what are your long-term projections for trends of the economy?
I mean, are people like you looking at potential recession?
Well, we don't really speculate on what we're going to see in the future.
What I can tell you is that the trend right now has been slowing.
That said, if you were to just sort of grab news articles around the country, you would
see that while that some economists are projecting that it'll climb back up, some are projecting
that it will have lower GDP this year, and there are not actually a ton of them calling
for a recession immediately.
Again, that doesn't necessarily mean that we won't have one or that one isn't coming.
But what I can see right now is what I can tell you, and that's that we're seeing a slowing
economy.
But even despite all the pushback from things like tariffs, the war in Iran rising prices,
like that, we're still seeing growth, and we're still seeing low unemployment rates.
And here in Wisconsin, we can look at our unemployment insurance claims data, and we're
still seeing that on trend and below the last couple of years as well.
So it's difficult to say with all the volatility and uncertainty right now what we'll see going
forward.
Yeah, indeed.
All right.
Well, Scott Hodeck, thanks so much.
Absolutely.
Thank you.
Wow, you are good at your job.
Thank you.
I appreciate it.
You like it.
Kind of going to make me blush, I think.
We really appreciate the info.
Yeah.
We'll call on you again, sir.
Well, I'd be happy to get an information out there is important, so I appreciate what
you do.
Thank you.
All right.
Enjoy this beautiful weekend.
Yeah, you too.
Thank you.
Thank you.
Thank you.
Bye.