Michigan Economy Rolls Along, But a Few Bumps: U-M Study

• Get Patch’s daily newsletter and real-time news alerts.

Michigan is poised to recover two-thirds of the jobs lost since 2009 over the next two years, and economic growth that began in 2000 is expected to continue, University of Michigan economists said in a report released Friday.

George Fulton, director of U-M’s Research Seminar in Quantitative Economics and the lead author of the study, said in a statement that “the Michigan economy has been on a bit of a roll for the past five or six years” and that “the state appears to be poised to continue the ride for a while longer, although not at the same pace.”

Fulton and economists Joan Crary, Gabriel Ehrlich and Donald Grimes expect Michigan employers to add 61,100 jobs through 2017 as the housing market and sales from Detroit Three automakers continue to rebound, and that could push the current jobless rate of 5 percent down to 4.8 percent by the end of next year and 4.5 percent by the end of 217.

The outlook isn’t all rosy, though.

By several important measures of economic success — such as the level of per capita income, per capita GDP, the employment-to-population ratio and educational attainment — Michigan ranks “closer to the caboose than to the engine,” the study’s authors noted.

“What this all tells us is that although we’ve made a fair amount of progress recently, we have a ways yet to go,” Fulton said in the statement.

Specific job gains cited by the economists through 2017 include:

• About 32,000 jobs in the professional and business services sector, including professional, scientific and technical services; management of companies; and administrative support services, including temporary help. Six in 10 of the sector’s jobs over the next two years will be knowledge-based, Crary said.
• About 22,000 jobs will be added in the construction industry.
• Leisure and hospitality will see gains of about 20,000 jobs.
• Manufacturing is expected to gain only about 10,000 jobs, down from an annual of about 20,000 manufacturing jobs over the previous four years.

“The deceleration in manufacturing job growth reflects the more mature stages of the recovery overall and slower growth in vehicle output moving forward,” Grimes said. “However, almost half of the manufacturing job additions from the end of 2015 to year-end 2017 are directly attributable to the auto industry, and many of the rest derive from auto-related industries.”