MILWAUKEE — The highly coveted Foxconn electronics manufacturing plant is coming to either Kenosha County or Racine County, three elected officials said Thursday.
Republican Gov. Scott Walker and Foxconn chairman Terry Gou signed a memorandum of understanding detailing the project Thursday evening at the Milwaukee Art Museum in front of an ecstatic crowd of local lawmakers and investors.
The deal calls for finalizing terms of the agreement — which will require a special legislative session to approve a $3 billion incentive package — no later than Sept. 30.
“This is something that will say to the world, ‘We have arrived,’” said Walker, adding that this is the company’s first U.S. manufacturing plant. “It has been a remarkable partnership to get to this point.”
Walker also highlighted the efforts of local lawmakers and White House Chief of Staff Reince Priebus, who reportedly told President Donald Trump about the need for it in southeastern Wisconsin when Trump visited Kenosha last spring.
Gou, who said Walker could one day be president, called Wisconsin “my home.”
Taiwan-based Foxconn is best known for making iPhones and other Apple products in China.
“This will not be your grandfather’s factory,” said Tom Still, president of the Wisconsin Technology Council. “This will be a high-tech facility that will attract workers of various skill levels to produce products that will really define where the economy is going to go for years to come.”
Foxconn said its $10 billion factory will initially bring 3,000 jobs and eventually employ 13,000 workers.
However, Foxconn has not said what type of jobs it will offer in order to produce liquid-crystal display panels that are used in televisions and computer screens.
The average salary for the jobs will be nearly $54,000, suggesting some of the higher-end positions will be engineers, software developers and people proficient in computer-assisted design, Still said.
Kenosha Mayor John Antaramian said the deal will benefit Kenosha and Racine, regardless of its exact location.
“I think this is a wonderful opportunuty,” Antaramian said. “It will be an interesting change in the type of technology that’s coming to the area. It’s a win no matter where it goes in the sense that all the communities in southeast Wisconsin will benefit from it.”
State Rep. Samantha Kerkman, R-Salem Lakes, said she also has high hopes for the plant.
“It’s an exciting relationship. Terry is a good guy and has a big heart. I’m excited for what’s coming down the line here. It’s going to be either in Racine or Kenosha County,” Kerkman said. “The impact is going to be felt throughout the state.”
State Rep. Peter Barca, D-Kenosha, echoed her sentiments.
“The potential for Wisconsin is enormous,” Barca said, adding that he wants to make sure future employees and area communities are protected. “Hopefully we can work hard and get the deal done.”
Some economists have pointed out that highly skilled postings are not always easy to fill.
“For an indicator I would look at Michigan. There are lots of workers in Michigan and there are lots of advanced manufacturing jobs in Michigan, and most of them are difficult to fill,” said Stefanie Lenway, dean of the Opus College of Business at the University of St. Thomas in Minneapolis.
Lenway also said that making LCD screens does not involve people “because people create defects on the glass and that’s expensive,” so it is unclear how many of the jobs will be for assembly workers.
Still said worker shortages for higher-skilled jobs are common around the nation and is a challenge that Foxconn would have faced with any of the other states it was considering — Michigan, Illinois, Indiana, Ohio, Pennsylvania and Texas.
But Wisconsin officials said the state’s higher education system is capable of producing enough employees by the time the plant opens in 2020. However, it’s a process that needs to start now.
Gateway, others excited
Walker said part of wooing Foxconn to Wisconsin included meetings with chancellors from the University of Wisconsin-Madison and UW-Milwaukee and the president of Gateway Technical College to talk about training opportunities so graduates would be prepared to work at the plant.
Bryan Albrecht, president of Gateway Technical College, posted on Twitter following Thursday’s celebration that he is excited “to be part of the new economy with Foxconn.”
To close the Foxconn deal, state lawmakers still have to approve tax credits for the company. The incentive package, which lawmakers could take up in a special session next month, will be pro-rated on how many jobs the company creates and how much it spends.
Walker and other state officials have said the trade-off for the incentives will pay off in the long run, noting that Foxconn’s presence will create thousands of other jobs through the hundreds of suppliers it will rely on for materials.
Cautions and ‘cynics’
Walker said Democrats who were skeptical of the deal were “cynics.”
But the full impact of Foxconn’s planned factory may still be too early to measure, according to an economics expert at the UW-Milwaukee.
“It’s difficult to assess how this factory, if in fact it comes to be, will affect the labor market without knowing what the jobs are,” said Marc Levine, senior fellow and founding director of UWM’s Center for Economic Development.
Critics have also cautioned that Foxconn has made promises before to invest in the U.S. and not followed through. Foxconn promised in 2013, for example, to invest $30 million and hire 500 workers for a new, high-tech factory in Pennsylvania that was never built.
“So I think there’s some question about the modus operandi of Foxconn on these sorts of things,” Levine said.