Wisconsin’s Foxconn debacle causes officials to rethink subsidies - Paycheck

Wisconsin’s Foxconn debacle causes officials to rethink subsidies

Wisconsin recently renegotiated a $2.85 billion incentive package with Foxconn down to $80 million. Because the company never met its hiring targets, the state did not have to pay any of the $2.85 billion in incentives it had promised in the original deal. But close to $1 billion has already been spent on infrastructure and land acquisition, with large portions of those costs falling to the Village of Mount Pleasant and Racine County, both of which saw their debt downgraded.

Government officials are also saying that the situation has caused them to rethink their approach to business subsidies.

You might recall that Foxconn is the Taiwanese electronics manufacturer that promised to create 13,000 jobs at a massive $10 billion new facility. But the company never met its hiring targets, and the future of the vastly scaled-down facility is unclear.

Meanwhile, Foxconn has been doing light manufacturing on the site, which includes four buildings and a giant glass sphere that the company originally planned as a data center, but apparently only contains an auditorium.

The company used the site to manufacture masks and ventilators in the early months of the pandemic, and reportedly is assembling computer servers now. It is also considering assembling electric vehicles there under a joint venture announced earlier this year with Fisker.

Industry experts say companies and states have gotten less aggressive about subsidies as a means to attract businesses, choosing instead to look more closely at factors like workforce and infrastructure.

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Also, check out how Wisconsin’s total labor force now has around 9,300 more people than it did in February 2020

As always, here at Paycheckology we are “Translating the media circus into what matter$”

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