GUEST EDITORIAL: Michigan’s economic revival is under way

Over the course of the next year, as we march toward a gubernatorial election, Michiganders will be bombarded with economic news showing Michigan has either done really poorly during the past four years, or really well. The news, of course, will be spun depending on who sends it out.

So it is good that we can look at some data not through the lens of a particular political party, but instead through the eyes of economists who have studied the data and have reached conclusions that we find to be surprisingly good.

Economists George Fulton, director of the University of Michigan’s Research Seminar in Quantitative Economics, and colleagues Joan Crary and Donald Grimes predict Michigan will add about 130,000 jobs over the next two years, in addition to the 80,000 jobs added this year.

“Michigan is closing out 2013 with a healthy year of growth, the second-largest gain in jobs since 1999,” Fulton said. “Michigan has performed exceedingly well compared with the nation and most other states in private-sector job growth recently, particularly in industries at the better-compensated end of the wage scale. … The state is making inroads into replenishing the severe losses it suffered during the opening decade of the 2000s.”

The state averaged gains of 57,000 per year from 1971 to 2000, the report stated.

What that will translate to, Fulton said, is a 7.9 percent unemployment rate at the end of 2014 and a 7 percent unemployment rate at the end of 2015.

Of course, even with this better-than-average job growth, not everyone is a winner. More than half of the job gains since 2012 have been in professional, scientific and technical services. All of these positions require extensive after high school education or training. Construction is reviving and will add 21,000 jobs in the next two years, and health care has added jobs every year since 1999.

“In all, the continuing recovery in Michigan, including its moderating tempo, is consistent with an expanding U.S. economy, a recovering local housing sector and increasing, albeit slowing, Detroit Three vehicle sales,” Fulton said. “There are parts of society that are not benefiting, or not benefiting fully, from the state’s successes, but Michigan does appear to be positioned for a longer run of macroeconomic resurgence.”

We shall see, but this early bit of news should boost the consumer confidence of most Michigan residents when they go to the polls next year.

 

This editorial originally ran in the Dec. 1 edition of the Midland Daily News.

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Posted by Tribune News Services

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