Foxconn to pay nearly $1 billion in wages and benefits

Terry Gou talks to reporters ahead of a memorandum of understanding signing.

More than 75 percent of the 13,000 jobs Foxconn plans to fill for its Wisconsin manufacturing facilities will go to hourly operators and technicians, according an Ernst and Young economic impact report.

Terry Gou talks to reporters ahead of a memorandum of understanding signing.

In addition to the more than 9,800 hourly positions, the company also plans to hire 1,600 process equipment engineers, 820 people for business support, 463 integration engineers and 300 computer-integrated manufacturing engineers.

The company would pay out nearly $1 billion in wages and benefits annually if all of the positions are filled, the report states. The memorandum of understanding signed by company leaders and state officials Thursday would give the company six years to fully staff the facilities and make $10 billion in capital investments in exchange for $3 billion in tax incentives.

Gov. Scott Walker said Wednesday the company would pay an average wage of $53,875 for the 13,000 jobs. In addition to the roughly $700 million in base wages, the economic impact report indicates the company would pay an average of $7,300 in overtime and $12,300 in benefits to each employee.

Foxconn’s presence, if it reaches its goal of 13,000 employees, would directly generate $7.63 billion in economic output, including a $3.36 billion boost to state GDP, according to the report.

Those figures do not include the 11,453 indirect jobs at Foxconn suppliers and 10,792 induced jobs at businesses selling to Foxconn employees, the report states.

The indirect jobs estimate includes plans for 400 jobs at a glass manufacturing plant that will be co-located with Foxconn’s LCD facility, the report says. The supplier plant was not specifically mentioned in previous statements about the number of jobs to be created by the project.

All told, the EY report estimates the Foxconn and the indirect and induced jobs will generate $11.11 billion in ongoing statewide economic impact, including a $5.22 billion boost to state GDP.

The increase in GDP would be an increase of 1.6 percent over the $317.22 billion annualized figure Wisconsin had in the first quarter of the year.  The state GDP grew by 1.1 percent in all of 2016, according to figures from the U.S. Department of Commerce Bureau of Economic Analysis.

Those figures don’t include the potential impact of construction. Over a four-year period, the project is expected to require 10,234 direct construction jobs and another 5,972 in indirect and induced employment.

Construction is projected to generate $9.34 billion in total economic output, including a $5.02 billion increase in state GDP.

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Arthur covers banking and finance and the economy at BizTimes while also leading special projects as an associate editor. He also spent five years covering manufacturing at BizTimes. He previously was managing editor at The Waukesha Freeman. He is a graduate of Carroll University and did graduate coursework at Marquette. A native of southeastern Wisconsin, he is also a nationally certified gymnastics judge and enjoys golf on the weekends.

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