Employment in Michigan and Minnesota

The biggest push-back we get on our using Minnesota as a model for Michigan is racial. Some version of “they don’t have the concentration of minorities–particularly low income African Americans–we have.” Which is true. Racial minorities are 13 percent of Minnesota’s working age population (16 and older), 21 percent of Michigan’s. (For African Americans its 4.9 compared to 13.3 percent.) 


But as the table below demonstrates racial differences are not a plausible explanation for why they have better economic outcomes than we do. The table shows the proportion of those 16 and older in each category that worked in 2014. Its the best measure of employment, far better than the unemployment rate.

As you can see more Minnesotans than Michiganders work in every category except Asians. If the same proportion of MIchiganders worked as Minnesotans there would be 847,000 more Michiganders working today. Michigan employment would grow from 4.40 to 5.25 million.

For whites the gap is 10 percentage points. For African Americans its 14. The black/white gap in Michigan is 12 percentage points, in Minnesota its less than five. Whites in Michigan work less than African Americans in Minnesota: 57.3 compared to 63.0 percent.

So something other than racial composition is the explanation for Minnesota’s far superior job-providing economy. Its time we stop using racial composition to excuse away Michigan’s inferior economic outcomes.

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