Capitol Update

by Senator Howard Marklein

December 3, 2021

We're Back On the Roads

Many different industries have been impacted by the COVID-19 pandemic. We all know of businesses that have closed, businesses that have shifted to new ways of doing things and businesses that have flourished. Throughout the pandemic I have watched and analyzed many different trends to understand the potential impacts on our state, our economy and our way of life.
 
An oft-ignored, but very interesting, economic indicator is the gallons of gasoline and diesel purchased by consumers. The following graphs illustrate the gallons of gasoline and the gallons of diesel purchased in Wisconsin in 2019, 2020 and 2021. Data is provided by the Wisconsin Department of Revenue (DOR).
 

The statewide lock-down in spring 2020 had a tremendous impact on the gallons of gasoline purchased in our state. As you know, many of us significantly reduced our trips to and from work, for errands and for pleasure. As a result, there was a sharp drop in the gallons of gasoline that were purchased in our state.
 
The gallons of gasoline purchased declined by 31.21% over the prior year in April 2020. This continued into May 2020 with a 21.61% decline.  By June 2020, we were only down 7.63% over prior year and things started to improve.  However, we were down about 10% for most of 2020.
 
When looking at the gallons of diesel purchased, the trend is somewhat the same. However, the decline was less and recovered much more quickly. Even as many of us reduced our trips, goods still had to be moved from place to place.   
 
The gallons of diesel purchased declined by just 1.61% over the prior year in April 2020. In May, the decline increased to 5.44%. However, by June 2020, we were up 7.52% over the prior year. In fact, we ended 2020 up 0.93% over 2019 totals.
 
As I analyze data for 2021, I am pleased to see that we are rebounding and nearly back to pre-pandemic levels of gasoline consumption. In June and September of 2021, we actually surpassed pre-pandemic levels. I will be anxious to see the data for November and December when it becomes available.
 
The 2021 data for the gallons of diesel purchased is even more interesting. Not only have we met pre-pandemic levels, we have exceeded them. For example, in April, we were up 12.26% in 2021 over 2019 levels, June was up 15.44%, and September was up 12.38%. This tells me that more goods than ever before are being transported across our state.
 
This is an important economic factor to watch because it greatly impacts road funding through gas taxes and is an indicator of the health and stability of our economy.  The lost gas tax revenues in 2020 will never be recovered. We aren’t driving double the miles now to make up for the days we stayed home in 2020.
 
However, the data definitely tells us that people are moving around again. In fact, Wisconsin had one of its best years for tourism dollars spent. We saw a 1% increase in tourism dollars spent in Wisconsin in 2021 over 2019 numbers.
 
According to the Wisconsin Department of Tourism, Wisconsin is only one of 13 states to report positive growth over 2019. All of our neighboring states experienced spending declines. Illinois and Minnesota showed 21% and 20% decreases in spending over 2019 while Iowa and Michigan did better with only a 5% and 3% decline.
 
As we continue to recover and move forward, Wisconsin is in a very positive fiscal position. I will continue to monitor data like gallons of gasoline, as well as other economic indicators in order to better understand our position as a state.
 
For more information and to connect with me, visit my website http://legis.wisconsin.gov/senate/17/marklein and subscribe to my weekly E-Update by sending an email to Sen.Marklein@legis.wisconsin.gov. Do not hesitate to call 800-978-8008 if you have input, ideas or need assistance with any state-related matters.