To be a “Top Ten” state for jobs, personal income and a healthy economy, Michigan needs to be economically more competitive with other states and nations. BLM defines “competitive” as having a cost/value balance as good or better than “Top Ten” states.
The chart below highlights Michigan’s progress as measured by key economic indicators. The scale shows a 50-state ranking from best (1) to worst (50), to indicate where Michigan is performing well and where we need to improve.
Current “Top Ten” states for jobs, income, GDP and population:
- New York
- North Dakota
Opportunities and Challenges Ahead
Michigan’s business costs have improved but job creation and business attraction tools are lacking
Michigan’s corporate tax climate has improved to 10th best in the nation from second worst. While our business climate has improved, Michigan offers fewer incentives for business to locate here.
For example, Michigan is one of only four states with a corporate income tax that fails to offer tax credits for job creation and ranks 28th in economic development spending, which is less than half of the “Top Ten” average.
Harnessing michigan’s innovative strengths to grow jobs in key areas of opportunity
Michigan remains a “Top Ten” state for R&D, with a ranking of sixth for university R&D, and is highly innovative, ranking 12th in the U.S. for the number of patents awarded.
Michigan can use this expertise to meet growing global demand in areas where it has unique strengths. The New Michigan Plan highlights six areas with the highest potential to create thousands of good paying jobs over the next 10 years.
Not enough skilled talent
Michigan needs more workers with an education beyond high school. Michigan ranks 31st in educational attainment. Fewer than one in four public high school students is enrolled in a career or technical education course. The state ranks 27th in the number of critical skills degrees and certificates awarded.
Demographics are also working against us. Michigan is the 10th oldest state with a median age of 39.6, and we’re not attracting the talent we need to replace people who are aging out of the workforce. We currently rank 28th for talent migration and 46th for out-of-state college/university enrollment.
Debt, unfunded liabilities threaten fiscal stability
Michigan governments’ long term liabilities risk our fiscal future. State unfunded liabilities, such as retiree pensions and other post-employment benefits (OPEB), limit our ability to invest in education, economic development or infrastructure. Ranked 23rd highest in 2014, Michigan’s unfunded pension liabilities are $3,311 per capita while OPEB liabilities are $2,384 per capita (10th highest).
Local government debt creates a similar challenge with 4.4 percent of spending going to service debt. Michigan’s high number of local units of government and lack of sustained service sharing and collaboration exacerbate fiscal pressures.
Each and every Michigan resident bears $5,695 in unfunded state liabilities (2014 data).