Detroit and Michigan Booming

[Lowell]

The good economic news just keeps coming. Wouldn't it be an irony of our region lead a national recovery?

First this from Manpower via the WWJ website...

Detroit Hiring Market Now One Of Nation’s Hottest

MILWAUKEE, Wis. — The Detroit-Warren-Livonia Metropolitan Statistical Area will be one of the strongest job markets in the country in the July-through-September third quarter, according to the quarterly Employment Outlook Survey from the Milwaukee, Wis.-based temporary help firm Manpower Inc.

From July to September, 27 percent of Detroit-area employers interviewed plan to hire more employees, while only 5 percent of employers expect to reduce staff. Another 68 percent expect to maintain their current work force levels.

“The employment forecast for the third quarter is considerably healthier compared to the second quarter of 2012 when the Net Employment Outlook was 10 percent,” said Manpower spokesman Eric Jones. “Employers also expect significantly improved employment prospects compared with one year ago when the Net Employment Outlook was 3 percent.”

Source

Then this from this week's Crain's Detroit Business...

• The Southeast Michigan Purchasing Managers Index rebounded from a dip in April with a 3.7-point rise in May to 66.3, the highest reading this year. Any value above 50 indicates a favorable economy.

• Michigan's gross domestic product last year enjoyed the sixth-highest growth [[2.3 percent) in the U.S., according to a report by the Bureau of Economic Analysis at the U.S. Department of Commerce. In comparison, the overall U.S. GDP rose 1.5 percent in 2011.

Source [scroll down page]

[DetroitPlanner]

Unfortunately this is all relative. There are still plenty of people who are out of work.

Certainly the above post is great news. However it needs to be put into perspective. Two issues can frame my arguement.

1. Metropolitan Detroit lost a staggering number of jobs in the 2008-2010 period then laid dormant for most of 2011. This means comparing year to year is difficult as the last years were horrible for the local economy. We are now having a good year but comparing it to bad ones magnifies how bad things really were.

2. We are still nowhere near where we were pre-recession. We were one of the canaries in the coal mine on the last one, no one sunk as badly as we did. The 2010 census shows only one state losing population, that being Michigan. Even Louisana was more stable than we were. Our 'economic Katrina' was much worse on us than New Orleans' 'natural Katrina' but instead of lots of help without any questions we were subjected to criticism that we made too much money, that our companies deserved to go under, and that unions were evil. Detroit was painted as a villian by all.

On the bright side, we did the impossible. We were the city that did not die. Yes we have been battered but we are still alive and fighting. Just like the Superbowl ad said we are showing America how to be great again, though unfortunately we have to do it with a diminished tax base, which is leading to fewer cops on the streets, fireman, and more crime to deal with.

[313WX]

Unfortunately this is all relative. There are still plenty of people who are out of work.

Certainly the above post is great news. However it needs to be put into perspective. Two issues can frame my arguement.

1. Metropolitan Detroit lost a staggering number of jobs in the 2008-2010 period then laid dormant for most of 2011. This means comparing year to year is difficult as the last years were horrible for the local economy. We are now having a good year but comparing it to bad ones magnifies how bad things really were.

2. We are still nowhere near where we were pre-recession. We were one of the canaries in the coal mine on the last one, no one sunk as badly as we did. The 2010 census shows only one state losing population, that being Michigan. Even Louisana was more stable than we were. Our 'economic Katrina' was much worse on us than New Orleans' 'natural Katrina' but instead of lots of help without any questions we were subjected to criticism that we made too much money, that our companies deserved to go under, and that unions were evil. Detroit was painted as a villian by all.

On the bright side, we did the impossible. We were the city that did not die. Yes we have been battered but we are still alive and fighting. Just like the Superbowl ad said we are showing America how to be great again, though unfortunately we have to do it with a diminished tax base, which is leading to fewer cops on the streets, fireman, and more crime to deal with.

Yep, I completely agree with this post.

When you're at Rock Bottom, you have no other direction to go but up.

[rex]

The big 3 make money, add shifts and employees and things get better. Many other industries get a push.

[Lowell]

When you're at Rock Bottom, you have no other direction to go but up.

Au contraire. Had Obama not bailed GM and Chrysler we would have gone straight through Rock Bottom into free fall. It is almost incomprehensible to think of that situation - assembly lines shut down, Renaissance Center empty and up for sale. And Detroit and many suburbs completely broke or hopelessly crippled.

[Danny]

QVE!!!

The only way the Detroit and Michigan boomed is Dan Gilbert's mass employee exodus to Downtown Detroit and Synder's international bridge to nowhere.

[ndavies]

Other good news, Michigan was the 6th fastest growing state in 2011,
http://money.cnn.com/galleries/2012/...-states/6.html

And Zillow belives Grand Rapids is the best place to buy a house in 2012
http://www.zillow.com/blog/2012-06-0...o-buy-in-2012/

[313WX]

Au contraire. Had Obama not bailed GM and Chrysler we would have gone straight through Rock Bottom into free fall. It is almost incomprehensible to think of that situation - assembly lines shut down, Renaissance Center empty and up for sale. And Detroit and many suburbs completely broke or hopelessly crippled.

I agree thing would have been far worse had the Auto Industry simply been allowed to fail.

However, even without the Auto Industry officially "failing", the fact that it came pretty darn close to doing so absolutely crippled the city's and state's economy, and as a result during the peak of the reccssion Michigan was by far hit the hardest amongst all states in the US.

So in hindsight, while it appears the economy is "booming", you have to temper those numbers with the fact that we have much farther to go than any other city and state before we fully recover, because we fell so much farther than thme in the first place.

[Richard]

The big 3 make money, add shifts and employees and things get better. Many other industries get a push.

You are right,it would be interesting to see the breakdown of the numbers to see if the percentage of diversification is rising within the state or if this is just a rise because the auto sector has regained its footing.

[Scottathew]

Au contraire. Had Obama not bailed GM and Chrysler we would have gone straight through Rock Bottom into free fall. It is almost incomprehensible to think of that situation - assembly lines shut down, Renaissance Center empty and up for sale. And Detroit and many suburbs completely broke or hopelessly crippled.

As a fiscal conservative, I was against the auto bailout.

I must say, I agree with you. I was dead-wrong. The auto-bailout has really helped out out not just Michigan, but the entire country. The amount of jobs it has saved is amazing.

[cman710]

For anyone interested in a more in-depth discussion of Michigan's recession and its recovery, I would suggest "Is Michigan's Recovery Real?," an analysis presented by Michigan Department of Technology, Management, and Budget.

[kryptonite]

I tend to be a little left of center politically and was highly supportive of the loans to GM and Chrysler.

But I agree with the posters that when you are at bottom there is no place to go but up. However, bottom for us was certainly not where bottom would have been if Bush and Obama had not supported the auto loans. As much as I disliked Bush, he did support and initiate an initiative to prevent the domestic auto makers from failing. Obama also did not turn his back on the industry.

Detroit has bottomed out many many times since the boom days of the 1950's. I think now Detroit and Michigan are finally learning much from being at the bottom and attempting to attract a variety of businesses so our lows won't be so low in the futre.

I hope.

[cman710]

In case anyone is interested, here are the MI state GDP numbers going back to 2001. I obtained this data from the Bureau of Economic Analysis Website. These numbers are not adjusted for inflation, so they do not provide a complete picture.

2011: $385,248,000
2010: $368,371,000
2009: $350,847,000
2008: $368,963,000
2007: $386,591,000
2006: $376,208,000
2005: $375,753,000
2004: $365,609,000
2003: $362,652,000
2002: $351,832,000
2001: $337,440,000

[coracle]

In case anyone is interested, here are the MI state GDP numbers going back to 2001. I obtained this data from the Bureau of Economic Analysis Website. These numbers are not adjusted for inflation, so they do not provide a complete picture.

2011: $385,248,000
2010: $368,371,000
2009: $350,847,000
2008: $368,963,000
2007: $386,591,000
2006: $376,208,000
2005: $375,753,000
2004: $365,609,000
2003: $362,652,000
2002: $351,832,000
2001: $337,440,000

If you apply the Ave Inflation figures from Historical Inflation Rates: 1914-2012, Annual and Monthly Tables - US Inflation Calculator to $337M for 10 years it comes to $428M; so GDP hasn't kept up with inflation; which means we've been static/declined.

[Cincinnati_Kid]

Detroit is on the verge of going bankrupt, but the city and state is booming? Go figure. I don't think so, ill-regardless of the kool-aid these so called economists are trying to make us drink. You can show me all the graphs, data, and pie charts you want.

[wolverine]

I just went to the website of the firm that conducted the survey and downloaded the results.

* They mention 18,000 companies were interviewed
* They do not mention how many companies were interviewed in each state
* There is no indication how many employees will be hired
* There is no follow up survey on how many employees were hired.

Without concrete numbers of actual permanent job positions being filled, these survey results are pretty useless. They're nothing more than positive conversation. I randomly clicked on a bunch of states and many showed similar percentages in hire / retain categories. Question is, how many companies in each state were surveyed, and how many people will they hire?

100 Companies vs 1000 companies?
5 employees or 50 employees?

And how do these numbers affect state unemployment percentages?

[Crumbled_pavement]

As a fiscal conservative, I was against the auto bailout.

I must say, I agree with you. I was dead-wrong. The auto-bailout has really helped out out not just Michigan, but the entire country. The amount of jobs it has saved is amazing.

SACRILEGE!!! I order you out of the Republican party, effective immediately.