43rd and falling?
As we explored in my last post on the best measure of employment––the proportion of those 16 and older with a job–-in 2013 Michigan ranked 43rd. Clearly not something to celebrate.
To make matters worse there is a good chance that things will get worse, not better. Take for example the future job growth projections done for the Michigan Economic Development Corporation by Idaho based Economic Modeling Specialists International. (You can access all their national, state and regional profiles, including projections, at the MEDC website here.) As part of their Michigan Economic profile they did job projections for the state from 2012-2023. The graph below is from their report and compares future job growth trends in Michigan compared to the nation.
As you can see they are projecting over the next decade or so job growth in Michigan at a rate about two thirds the national average. About 10% job growth in Michigan over the time period compared to 15% nationally. The difference between a 10% growth rate and 15% is about 263,000 jobs. So if Michigan were projected to grow at just the same rate as the country there would be 263,000 more Michiganders with jobs a decade from now than is currently projected by a report commissioned by the state’s economic development agency.
These projections were done in 2013. This is after the state had enacted huge business tax cuts and right to work legislation. And after Michigan zoomed up in the Tax Foundation rankings of business friendly states.
And the projections are not an outlier. They are consistent with the Bridge projections we wrote about previously that show Michigan likely to be 49th in job growth over the next decade.
What these projections reflect is that Michigan continues to have structural liabilities it has not addressed. Those liabilities were not business friendly related. As we wrote in the post on the Bridge projections:
Across the country the places which are creating more and better jobs have two characteristics in common: a high proportion of adults with a four-year degree and a high proportion of their jobs and wages are concentrated in the knowledge-based sectors of the economy. Michigan ranks in the mid thirties in each. (The only exception are the few states with oil and natural gas driven economies.)
These projections are predominantly based on Michigan’s current demographics (slow population growth, lower college attainment and aging faster than the country) and our current industrial structure (concentrated in slow growth and low pay industries). If the state doesn’t change this we, almost certainly, will continue to grow slower than the country in both jobs and personal income.
This Post Has 3 Comments
Does the statistic for % of people 16 and over who are working make any adjustment for those who are over retirement age (65-70) and do not intend to work any more?
If a significant number of people move to Florida or Arizona after retirement, it could artificially reduce the % of adults working in those states. If a lot of retired people leave Michigan for Arizona or Florida, it could make our employment % look better than is should. So our employment % could be even worse if older people were not migrating to other states. I have several relatives who have done that.