Economists predict steady job growth in Michigan
Jul 21, 2015 at 1:32 PM
University of Michigan economist George Fulton and his colleagues, Joan Crary and Donald Grimes, said in their annual November forecast of the Michigan economy that the state will add 130,000 jobs during 2014 and 2015. Those gains, they say, will come on the heels of job increases of about 80,000 this year and more than a quarter-million since early 2010.
The expected job increases over the next two years will bring Michigan back to levels achieved just before the 2008-09 Great Recession and nearly halfway back to mid-2000 levels, according to the economic forecast.
About 60,000 of the 2014-15 job gains will be split among professional and business services and the trade, transportation and utilities sector, the researchers said. Other major sectors projected to add jobs during that time include construction, manufacturing and health care.
In addition, the report said housing, one of the state's weakest major sectors in recent years, has turned around.
"The story based on measures of the macroeconomy is largely encouraging and optimistic," said Fulton, the director of the Ann Arbor university's Research Seminar in Quantitative Economics.
There are microeconomic considerations as well, the report says, pointing out that there are portions of Michigan's population that are not benefiting from the state's broader successes.
"The state unemployment rate, currently around 9 percent, is still too high, well above the rates we saw prior to the Great Recession of 2008-09," the economists wrote. "For many residents, economic recovery has not yet arrived, and may not arrive any time soon.
"The proportion of the population living in poverty or near poverty has increased in Michigan from 2010 to 2012."
Fulton, Crary and Grimes also warned about the unpredictability of how Detroit's bankruptcy filing will affect the economy in the state's largest city and its residents.
"We don't know how the process will unfold at this time, but as was the case with the auto bankruptcy, the retirees associated with the Detroit government sector are particularly vulnerable stakeholders," the report says. "How the bankruptcy issues get settled can have a potentially dramatic impact on this cohort of the population.
"And of course there is the longer-term perspective of whether down the road Detroit will become a better place to work and live."