On Tuesday, Bridge published an essay I co-wrote with Ned Staebler, the vice president for economic development at Wayne State University and the president and CEO of TechTown. We hope to inspire an important conversation among those who work in economic development in Michigan. The evidence is clear that it’s time to stop a failed economic development strategy that invests state resources in businesses, and reorient towards investments in talent. The introduction is below, and you can read the rest of the essay over at Bridge.
Michigan faces the prime economic challenge of our times: creating an economy that provides enough household-supporting jobs so that all working households can raise a family and pass on a better opportunity to their children. A prosperous Michigan is a place with a broad middle class where wages and benefits allow everyone to pay the bills, save for retirement and the kids’ education, and pass on a better opportunity to the next generation.
Even in Michigan’s strong pre-pandemic economy, 43 percent of households – most with at least one working adult – could not pay for basic necessities. When more than four in 10 Michigan families are struggling, our state is not succeeding, and our economic developers are failing. As long-time economic developers ourselves (who very much implicate ourselves when we talk about failing), we believe the primary goal of state economic policy should be rising household income for all Michigan residents.
Meeting this challenge requires not only that the state make rising income for all its top economic priority, but that it reevaluate and redesign its economic development infrastructure accordingly. This mission change will also require us to think differently not just about state and regional economic development efforts, but how they coordinate with community development, housing and workforce development policies and programs as well.
Currently, Michigan’s economic development programs and incentives are designed to support companies either relocating or expanding in the state in the hopes that good, high-paying jobs will follow. This has been the model for more than 40 years. But this strategy is not working. In Michigan, 60 percent of all jobs today pay less than $20 an hour – a far cry from the more than $60,000 a family of two adults and two children need to pay for the basics.
While there is no magic bullet, both of us have come to believe economic developers in Michigan are looking at their task all wrong. For Michigan to be successful, we must flip traditional efforts on their head and adopt a bottom-up approach. Talent doesn’t follow companies, it’s the other way around. That means it’s time to invest in human capital – our people.
Click here to finish the essay at Bridge. Our thanks to both Ned for his collaboration and to Bridge for sharing our work.