A UW-River Falls economics professor headlined the Jan. 18 Ellsworth Community Development Authority meeting with a presentation on the Ellsworth Cooperative Creamery’s economic impact on the region.
Logan Kelly, PhD, worked on the economic impact study with Pierce County Economic Development Corporation Executive Director Joe Folsom.
The ECC has been a vital contributor to the local and regional economy for more than a century, Kelly said. It employs 182 people at its Ellsworth location, which accounts for 8% of the village’s total employment. The ECC indirectly influences 1,233 jobs in the county, which totals 9.6% of employment in Pierce.
“There's some reasons for that, in particular, is when we start looking at the dairy industry overall, we see cheese consumption going up and we see cheese consumption being a fairly large portion of the finished dairy market,” Kelly said. “And so they're in a good position to continue to grow over time.”
The ECC’s value-added contribution to Pierce County’s Gross Domestic Product (GDP) is $119.8 million, which represents 8% of the county’s economic output.
“If we were to essentially shut down the Ellsworth Creamery tomorrow, totally cease operations, roughly speaking, the county unemployment would rise from the 2.9% it is now to approximately 9%,” Kelly said. “If we account for the positions that are affected by the Ellsworth Creamery, both directly as in the ones that they actually hire, as well as indirectly.”
The Ellsworth location generates about $252,146,000 million in revenue per year and attracts 254,000 visitors to its retail store, who make about 121,000 transactions annually. Forty-six percent of ECC employees live in Ellsworth; those who live here earn just over $4 million total per year in wages. The ECC influences about $11.9 million in sales at other Pierce County businesses, according to Kelly.
“And that's really what the whole idea of economic impact studies do, is they look at and try to understand what are these ripple effects?” Kelly said. “So cutting to the chase, what are some of these effects? The first thing we can see is direct employment. We have 182 employees at the Ellsworth facility and 46% of those employees live in the town of Ellsworth. So what we look at when we look at an economic impact study is how much of spending that income that's generated by the employment stays within the area of concern? And when people live here, that income stays within the area of concern. It has kind of the maximum effects. It's approximately 8% of overall employment within Ellsworth, Wis. In particular, if we look at jobs created, both directly and indirectly within Pierce County, it's about 1,233 and that represents almost 10% of the total employment within Pierce County.”
Indirect jobs could include dairy farm workers, truck drivers, teachers, customer service, etc.
“And so roughly what we see is a multiplier of about 3 ¾. So roughly speaking, if I increase one job, and this is a rough estimate, one job at the Creamery, that'll ripple out and eventually have a total impact of another three,” Kelly said.
The study lists the creamery’s output, or value of production, including indirect and induced effects, at $404 million from the Ellsworth location.
Pierce County is part of the Minneapolis/St. Paul Metropolitan Statistical Area with an estimated population of about 42,000 and a labor force of 24,000. The largest industries in the county are government, manufacturing and service.
The ECC pays $93,451 in property taxes to the Village of Ellsworth each year. It’s also located in Tax Increment District #8, a successful TID that contributes $10,487 annually of its tax revenue to a less successful TID. The ECC’s Menomonie and New London facilities provide 154 direct jobs and 819 indirect/induced jobs to the regional economy, according to IMPLAN data. IMPLAN is the leading provider of economic impact data and analytical applications used by researchers, policy makers, business leaders, governments and more. The study was funded by ECC ad Momentum West, which is a regional economic development organization serving Barron, Clark, Chippewa, Dunn, Eau Claire, Pierce, Pepin, Polk, Rusk and St. Croix counties.
Creamery CEO Paul Bauer, who is also on the Ellsworth CDA, said one reason the study was commissioned is a lot of misunderstanding floating around about the ECC’s impact on the community.
“It’s easy to say, harder to prove,” Bauer said. “…Ellsworth Creamery has been a part of the community for a century plus, and would like to be there for another century. That's our goal, but again, it's a two-way street with the community.”
Bauer said when he started at ECC, it employed 60 people in Ellsworth.
“When you look at what a community can do, and being strategic about the industries and how they interconnect to one another, to even grow the economy even further,” Bauer said.
CDA member Katy Melstrom said the community takes for granted the tourism dollars the ECC brings into the area. This study doesn’t touch on the tourism dollars, Folsom said, which are significant. The key is providing other tourism-related destinations to capture more of those dollars.
“The Cheese Curd Festival is really just a starting advertising point,” Bauer said. “For people that are not familiar with the town to come back at another time.”
The hope is they come back to Ellsworth, visit the Creamery, eat at a restaurant, stop into local shops, gas up their vehicles, etc. Last year alone, the ECC sold 45,000 pizzas in its retail store.
“I think there's some really great opportunities particularly in tourism, ag tourism in this county,” Folson said. “You’ve got some really great assets with its rural character and the vicinity close to the Twin Cities metro.”
