As the Wisconsin Legislature debates proposals to regulate data centers, its members should bear in mind the role of artificial intelligence in transforming the state’s largest business sector: Manufacturing.
It’s not that lawmakers shouldn’t set sensible parameters on how and where hyperscale data centers are built, how they draw on the electrical grid and how they use water for cooling vast arrays of servers. However, such regulations should be balanced by the fact AI will improve the competitiveness of many Wisconsin businesses in a world that’s not standing still.
At its core, AI is not about producing funny memes — how many babies playing with puppies do we need? — but working in a “physical” sense to improve processes that may involve tedious, repetitive work. Artificial intelligence does so by using vast amounts of data and other computing tools to find patterns, learn from them, make predictions and perform tasks.
Where is all that data stored? Some is within existing data centers — Wisconsin has 47 of them already — and the bulk would rest in hyperscale centers.
Just about any business sector has or will benefit from adoption of AI, including financial services, health care, law, agriculture and retail. In Wisconsin, one of the nation’s leading manufacturing states, AI adoption could make a major difference.
Many manufacturers recognize that, as illustrated by a poll of 405 executives conducted by the Wisconsin Center for Manufacturing and Productivity. Its annual survey showed jumps in how many respondents see AI as becoming an important part of their businesses — especially at a time when demographics make it harder to find enough workers.
Buckley Brinkman, an adviser to the WCMP, said the survey’s “AI embracement curve” has grown since 2023 as manufacturers see possible advantages.
“It’s going to have a huge impact on manufacturing. For most manufacturers, it’s going to make routine tasks and processes much easier,” Brinkman said.
Manufacturing is Wisconsin’s largest economic sector. It employs nearly 480,000 people in jobs that pay $68,400 per year, on average, and it contributes more than $72 billion per year to the state’s gross domestic product. Wisconsin routinely ranks among the nation’s three most concentrated manufacturing states, with 18.2% of its workers employed in such jobs compared with 8.8% nationwide.
The WMCP report recommended manufacturers take a step-by-step approach to adopting AI, such as finding a “champion” to lead the charge, experimenting with projects that show promise, and focusing on “quick wins” to demonstrate value.
“It’s really a technical outgrowth of ‘continuous improvement,’ a movement that has helped American manufacturers for about 40 years,” Brinkman said.
Similar thoughts were expressed by Spencer X. Smith of AmpliPhi Digital, who has spoken about AI nationally and who will present Feb. 25 in Wausau on behalf of UW-Stevens Point and Northcentral Technical College.
Smith spoke recently in Louisville, Kentucky, at a metal-forging conference where the audience was comprised of manufacturers from Wisconsin and the Midwest. Attendees wanted to learn more about using AI to “replace rote tasks they didn’t enjoy” or to enhance safety with robotics while “keeping a human in the loop.”
Like Brinkman, Smith recommends an AI adoption process for manufacturers and companies in other business sectors that boils down to one bite at a time.
Will AI replace some jobs in manufacturing? Brinkman and Smith agreed the answer is “yes” on one end of the scale but likely to create new jobs on the upper end. Failure to adopt the technology in some form can also mean manufacturing companies fall behind, which can cost even more jobs.
“I tell managers: You may not be doing what you’re doing today, but you’re not doing what you were doing five years ago, either,” Brinkman said.
“If people aren’t willing to change, (AI) can replace them in some cases,” Smith said.
The kinds of issues being confronted by Wisconsin lawmakers are not unlike those under consideration in other states. Coming to grips with them sooner rather than later can help improve one of the state’s historic economic drivers, manufacturing.
