New report: the metro Lansing economy
We have included metro Lansing in all our annual reports because mid sized regions anchored by a major research university can do well in a knowledge-driven economy. We use metro Madison, Wisconsin in the report as a comparison to metro Lansing. Metro Madison––although with a population of only 632,000––has a per capita income exceeded by only 12 of the 54 metropolitan areas with population of one million or more.
From 2001-2010, the four county Lansing regional economy––like the state––performed worse than the national economy.
Employment and Wages
In 2010 there were 212,000 jobs in metro Lansing, a decline of 24,000 (-10.1%) from 2001. Just like the nation, underneath the poor jobs record of the decade is the continuing divergence between the high and the low education attainment sectors. Metro Lansing’s employment in the high education attainment was 106,000 in 2010, a loss of 3,000 jobs (-2.6%) from 2001. In health care and education––where the national high education attainment job growth was concentrated––job growth in metro Lansing was 1,653 (3.3%) between 2001 and 2010. In the low education attainment sectors employment was 106,000 in 2010, a decline of 21,000 jobs (-16.3%) from 2001.
The average wage in metro Lansing followed the same pattern as the nation: high education attainment industries growing and low education attainment industries declining. The average wage for all jobs in the Lansing region in 2010 was $42,945, an increase of 4.2% from 2001. (In sharp contrast to the state and metro Detroit and Grand Rapids which had declining average wages.) In the high education attainment sectors the average wage was $53,005 a gain of 9.0%. In the low education attainment sectors the average wage was $32,955, a decline of 5.6% from 2001.
The gap in the average wage between the high and low education attainment sectors grew from $13,687 in 2001 to $20,050. In 2010 the average worker in the high education attainment sectors had wages about 1.6 times that of the average worker in the low education attainment sectors. Metro Lansing’s average wage in 2010 was 5.1% below the national average in the low education attainment industries and in the high education attainment industries, metro Lansing’s average wage in 2010 was 14.6 percent below the national average.
Per capita income in metro Lansing in 2010 was $32,866, a gain of $34 (0.1%) from 2001. But, even more so than for the nation, the underlying sources of region’s personal income is very worrisome, with the big loss of real private sector employment earnings per capita from 2001 – 2010 masked by the even larger personal income gains from government––either government employment earnings or, most importantly, transfer payments.
- Private sector employment earnings per capita in 2010 was a very low $16,705 a loss of $2,082(-11.1%) from 2001
- Government employment earnings per capita in 2010 was a very high $7,697 a gain of $665 (9.5%) from 2001.
- Personal income per capita from interest, dividends and rent was $4,317, a loss of $785 (-15.4%) from 2001.
- Transfer payments per capita in 2010 were $7,119, a gain of $2,536 from 2001 (55.3%).
The dramatic growth in transfer payments was accompanied by a sharp increase in the share of the population who were poor or nearly poor. In 1999, 17.3% of the metro Lansing population had an income that was less than 1.5 times the poverty level. By 2010, this value had increased to 24.3%. Metro Lansing also has an economy that is very dependent on government employment earnings rather than private sector employment earnings. Government employment earnings per capita are nearly 150% of the national average, while private sector employment earnings per capita are 70% of the national average. Rising poverty and growing transfer payments, combined with high government employment earnings and low private sector employment earnings are not a good way to start the 21st Century.
How metro Lansing in 2010 compared to the country
- Proportion of wages from high education attainment industries: 105.3% of US
- Average wage: 91.9% of US
- Average wage in high education attainment industries: 85.4% of US
- Average wage in low education attainment industries: 94.9% of US
- Proportion of adults with a four year degree: 98.6% of US
- Households with income 1.5 times the poverty rate or less: 97.5% of US
- Households with income 4 times the poverty rate or more: 93.8% of US
- Per capita income: 82.3% of US
- Private sector employment earnings per capita: 70.5% of US
- Government employment earnings per capita: 144.9% of US
- Interest, dividends and rent per capita: 64.5% of US
- Transfer payments per capita: 96.0% of US