High costs, inconvenience and a striking disconnect between the perceptions of business and local government concerning Milwaukee's business and regulatory climate threaten Milwaukee's competitiveness when compared with three other cities, according to new research from the Lakeland College Center for Economic Education.

According to the study, Milwaukee businesses rank the regulatory climate as a major problem. Milwaukee firms are more likely to disagree that local governments go out of their way to help business, they view the local business climate as less favorable and they are more likely to consider relocating than businesses in the cities of Green Bay; Denver, Colo.; or the Raleigh-Durham/Chapel Hill, (RDCH) North Carolina area.

"To a degree, businesses everywhere complain about government regulations and their negative impact on the economic climate," said Scott Niederjohn, Ph.D., the lead researcher on the Lakeland College study. "Milwaukee stands out, however, in that its businesses consistently view government as more of an obstacle than other cities.   Businesses in Milwaukee also appear to be markedly more pessimistic about the local business climate than firms in other parts of the state and country. In a global marketplace where perception is often as important as reality, this finding poses a serious threat to Milwaukee's competitiveness."

Among the reports findings:

• Less than half (49 percent) of Milwaukee businesses surveyed rank the community's business climate as "very favorable" or "favorable," compared to 75.5 percent for Denver, 73.8 percent for Green Bay and 77.5 percent for RDCH.


• 27 percent of Milwaukee business respondents rate the local business climate as "unfavorable" or "very unfavorable," compared with 11.2 percent in Green Bay; 9.5 percent in Denver; and 8 percent in RDCH.


• Nearly one in five (18.5 percent) of the Milwaukee respondents report that they have considered moving their businesses out of the city because of the city's unfavorable regulatory or business climate, compared with 14 percent in Green Bay; 10 percent in RDCH; and 8.5 percent in Denver.

Study co-author, University of Wisconsin-Milwaukee professor Mark Schug, Ph.D., said that another dynamic identified by the researchers was a "serious disconnect" between the perceptions toward regulations held by business and the perceptions held by local government officials.

While businesses most frequently cited "dollars spent to comply" as the single greatest problem caused by government regulation, only one of the Milwaukee aldermen surveyed identified compliance costs as the greatest problem government regulation causes. In addition, more than half of the alderman surveyed cited "low fees" and more than one third "low cost compliance" as characteristics associated with doing business in Milwaukee.

"One of the keys to Milwaukee's competitiveness in the future will be to create institutional tools to reduce that disconnect," Schug said.

The researchers made the following recommendations in the report:

(1) Milwaukee should create a "Business Regulatory Advisory Panel" charged to review existing and proposed regulations.

(2) The city should continue efforts to streamline its regulations and develop a true "one-stop shop" within city government, allowing businesses to deal with one agency for all city licenses and permits.

(3) City officials and business people should work with local legislators as well as the state's congressional delegation to determine how new rules at the state and federal level may have negative local impacts.

(4) Milwaukee should immediately freeze or reduce the regulatory compliance costs, taxes, and fees that businesses pay within the City.

(5) Leaders in Milwaukee should embrace the goal of creating a regulatory culture that is friendly and welcoming to business.

The full study is available at http://lakeland.edu/cee.