(The Center Square) – Michigan business leaders released a report comparing Michigan’s performance to the top 10 states that rank it 29th in the nation, but found that many other states surpassed Wolverine State.
However, Michigan had made significant gains since the Great Recession when it fell from 49 to its current level of 29.
“Michigan is much better off and has come a long way since 2009. However, despite 10 years of pre-COVID-19 economic growth, we are struggling to grow faster than our competitors,” said Jeff Donofrio, President and CEO. of the Michigan Business Leaders Branch. said in a statement. “As we continue to see economic disruption due to the pandemic, talent shortages and shifts in our economy, including towards vehicle electrification and advanced mobility, it is even more essential that we look at the competitiveness of the Michigan and ensure that in the decades to come, we focus on investments and actions that drive growth,”
The national analysis ranks states on metrics such as gross domestic product (GDP), median household income, perception of business climate, and indicators of economic growth and health.
These updated metrics provide a more holistic view of Michigan than a one-dimensional snapshot of the state’s economy. Donofrio said Michigan sees a “once in a generation” opportunity to spend billions of dollars on workforce and talent development to achieve long-term growth.
The top 10 states are Utah, Washington, Colorado, Texas, Massachusetts, Virginia, California, Oregon, Florida, and Arizona.
For example, the report found that more than double the percentage of Michiganders dropped out of the labor force (-2.7%) in the past three years than in the top 10 states above (-1.1%).
Other metrics weren’t as bad. Michigan’s educational attainment rate slightly outpaced that of the top 10 states (5.4% vs. 5.2%). Governor Gretchen Whitmer aims for 60% of working-age Michiganders to graduate with a degree or credential by 2030.
The report cites eight critical metrics of what it takes to be a Top 10 state, relative to Michigan’s three-year growth ranking against all other states.
Michigan business leaders identified areas for improvement:
- Dramatically increase degree and degree growth by using American Rescue Plan Act (ARPA) funding to drive degree growth and attract talent.
- Foster increased labor market participation by removing barriers to work and investing in childcare, broadband access and affordable housing.
- Improve our K-12 education system and use ARPA funding to fund classrooms, expand teacher training and recruitment, and invest in summer learning programs
- Implement a long-term economic development strategy to improve competitiveness in four areas: site development, customer service, incentives and talent
- Use unique ARPA funds to:
- Regional economic development, matching funds for site development, transition to electric vehicles and support for entrepreneurship/innovation/scaling-up activities
- Workforce training programs that fill talent gaps preventing business growth, support new jobs/locations and provide career progression pathways
“Unless Michigan urgently addresses our economic and educational challenges, we risk falling so far behind that we can never catch up,” Donofrio said. “If we invest and work today to overcome these challenges, we can build a prosperous state with a healthy economy and widely shared prosperity.”
John Mozena, president of the Center for Economic Accountability, a nonprofit for transparent economic development policy, told The Center Square that Michigan should focus on lowering taxes and barriers to work if it wants to. attract talent.
Every company pays corporation tax, but only some receive subsidies, Mozena said.
“In reality, economic growth does not come from big business,” Mozena said in a phone interview. “Big businesses are already big – they’ve grown – that’s why they’re big. Economic growth really comes from small businesses growing into big businesses and taking the community with them.
Mozena said the city of Detroit has some of the highest commercial and industrial property taxes in the country.
“We need to look at ways to get cities to make it easier to do business there, because cities are engines of economic growth, or should be if managed properly,” Mozena said.