Second in a five-part series authored in partnership with Altarum entitled Michigan’s Path to a Prosperous Future: Challenges and Opportunities.
This report assesses the current status of Michigan’s economy, workforce, and talent and evaluates key opportunities and threats to the state over the coming decades. Key findings of the report include:
- Michigan is relatively poor when compared to the average state. In 2021, the state ranked 34th among the states in both real per capita personal income and real median household income. Further, Michigan’s economic prosperity has trended down for many decades; in 1950, Michigan ranked 11th among the states in per capita personal income. Declines in traditionally high-wage manufacturing jobs along with sluggish wage growth in that sector contributed to long-run decline in per capita income.
- Incomes are especially low for Black households and those that reside in principal cities around the state. The poverty rate for Black households in Michigan (26.2 percent) is 4.4 percentage points above the national rate. Similarly, households that live in principal cities within Michigan’s 15 large metropolitan statistical areas have a 20.6 percent poverty rate as compared to only 16 percent nationally for such households.
- Michigan’s automotive legacy is still an asset to the state. Michigan still has a very high concentration of high-wage, high-skill employment among engineers; a concentration that significantly exceeds its Midwest neighbors. The state also continues to be a leader among Midwest states in new business development and entrepreneurship, which is a critical element of new job creation. Still, the state also falls well below national averages in terms of female and minority business ownership.
- Michigan lags behind the nation in college degree attainment. Michigan ranked 34th nationally in the percentages of its 25-and-older population that held at least an associate’s degree and that held at least a bachelor’s degree. It also ranked behind most of its Midwest neighbors. Data demonstrate that college degree attainment is a key factor in determining a state’s economic prosperity.
- Michigan’s school-age youth are not fully prepared for college and high-paying careers. Michigan’s 4th-grade and 8th-grade students scored well below the national average on standardized proficiency tests for reading and math in 2022. Following a nationwide trend, those scores also dipped significantly following the COVID-19 pandemic. Further, most Michigan high school graduates are not meeting college readiness proficiency standards; and those results vary dramatically by race and geography.