MADISON—Wisconsin faces significant demographic changes over the next 25 years. School enrollments and the labor force will shrink. At the same time, the number of seniors will double.

This is the picture of the state’s future painted by the Wisconsin Taxpayers Alliance (WISTAX) in a new study entitled "Wisconsin’s Future: Year 2015 and Beyond." Now in its eighth decade, WISTAX is a nonprofit, nonpartisan organization dedicated to citizen education and public-policy research.

"These trends will combine to present government with major new challenges," notes WISTAX President Todd A. Berry. "Incomes and tax revenues are likely to slow at the same time that segments of the population demand more services. To date, Wisconsin’s leaders, public and private, state and local, have not focused on the problem."

WISTAX researchers note that, during the 1950’s and 1960’s, state population grew 1.3% per year. The annual growth rate dropped to 0.6% during the 1980’s and 1990’s, and will slow even more, to 0.5% annually in the 2020’s.

However, this population slowdown will not be uniform across various age groups. While the state’s overall population will increase almost 20% from 2000 to 2030, the number of residents 65 or older will jump 90%, to 1.3 million. By contrast, the school-aged population (ages 5 through 19) will drop 5.3% between 2000 and 2015, and will only surpass 2000 levels by 2025.

Perhaps the most worrisome statistics relate to Wisconsin’s workforce (ages 20 through 64). According to WISTAX, this part of the population will rise slowly—about 0.8% per year—until about 2015, and then decline 0.2% annually until 2030. Over this 15-year period, the working-age population will drop by 85,000.

A smaller workforce means that state income growth will slow, and continue to lag the nation. WISTAX reports that, during 2000-05, real ("inflation-adjusted") personal income per capita is expected to rise 2.5% per year in Wisconsin, compared to 2.6% for the U.S. Both these figures will fall in each successive five-year period until the corresponding income-growth figures during 2020-25 will be only 1.0% per year for Wisconsin and 1.1% for the U.S.

"Barring any changes in tax law," the WISTAX study notes, "slower-growing incomes will translate into slower-growing tax revenues." Particularly affected will be state government, which relies chiefly on income and sales taxes. The study finds that state general fund revenues (GPR) adjusted for inflation increased 2.9% per year during 1990-91 through 2000-01, but will grow only 2.3% annually from 2000 to 2025.

Just as population trends vary by age group, they also vary by region. Using state figures, WISTAX finds that population growth from 2000 to 2030 will exceed 25% in 13 counties. Four of these are in the Appleton-Green Bay area (Brown, Calumet, Outagamie and Oconto). Three are in the southeastern portion (Washington, Walworth and Kenosha) and two are in the south-central part of the state (Dane and Sauk). The remaining counties (Dunn, Eau Claire, Polk and St. Croix) are in the northwest near the Twin Cities. St. Croix will lead the state with a 70% increase.

By comparison, in 24 counties including Milwaukee, populations will grow less than 10%. Most of these counties are concentrated in the southwest and, particularly, across the northern tier. The number of people in Price and Iron counties is actually projected to drop over the 2000-30 period.

This slowdown will be especially prevalent in the school-aged population, according to WISTAX. In 62 of the state’s 72 counties, student numbers in 2015 are likely to be smaller than in 2000. In 39, the drop will be at least 10% during this period. Hardest hit will be Iron county, with a 41% drop. In Price, Vilas and Florence counties, student numbers will be down more than 30%.

Although student numbers will rise statewide between 2015 and 2030, 14 counties will continue to see declining numbers of school-aged children. Almost all in the north, these counties are led by Door, Florence, Forest and Rusk—all of which will experience declines of 6% or more.

"The impact of these drops will create significant challenges for affected school districts in these counties," observes WISTAX Research Director Dale Knapp. "School aids and district revenues are linked to student numbers. Yet, a portion of school budgets are not. Consequently, these districts face tough school budget decisions in the years to come."