This report provides a fact-based assessment of Michigan’s economic competitiveness relative to other states. Michigan’s performance is compared on key output (e.g., employment, GDP) and input (e.g., labor cost) metrics. A set of “traditional,” “new economy,” and “Top Ten” benchmark states were used to provide multiple reference points to evaluate Michigan’s performance.
While the intent of this report is not to make recommendations, general conclusions are outlined. These conclusions are used by Business Leaders for Michigan to help develop strategies for making Michigan a “Top Ten” state for jobs, personal income, and a healthy economy.
3. BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
1
Introduction
This report provides a fact-based assessment of Michigan’s economic competitiveness
relative to other states. Michigan’s performance is compared on key output (e.g.,
employment, GDP) and input (e.g., labor cost) metrics. A set of “traditional,”“new economy,”
and “Top Ten” benchmark states were used to provide multiple reference points to evaluate
Michigan’s performance.
While the intent of this report is not to make recommendations, general conclusions are
outlined. These conclusions are used by Business Leaders for Michigan to help develop
strategies for making Michigan a “Top Ten” state for jobs, personal income, and a healthy
economy.
Why is it important for Michigan to be a “Top Ten” state? Simply put, it would
result in more jobs, better incomes and a stronger economy. If Michigan were performing
like a “Top Ten” state today, there would be:
120,000more Michigan people working
$11,000more income per person
$13,000more GDP per person
Research for the 2015 Economic Competitiveness Benchmarking Report was
conducted by Anderson Economic Group, a research and consulting firm with
expertise in economics, public policy, finance, and industry analysis.
4. Methodology
UNEMPLOYMENT RATE
RANK
Level
46
7.3%
5.1%
th
TrendTop10Avg.
How To Read This Report
Across the globe, analysts use a series of common
measures to determine the economic strength of
countries, states, and regions. The measures are
divided into two categories: outputs and inputs.
• Output indicators like jobs, income,
population and GDP show us the impact of policy
decisions. They are the end result of ongoing
economic development and policy changes.
• Input indicators measure the factors
businesses look at when deciding where to
locate. In this report, Michigan’s input metrics
are divided into two categories: cost
indicators and value indicators. When
deciding whether nor not to locate or expand
in a region, job providers evaluate the costs
(e.g., taxes, fees, utilities) of doing business in
a region relative to the value (e.g., talent,
infrastructure) it provides. Ultimately, areas
that offer more value for equal or lower cost
encourage business growth and attraction
which leads to more jobs, higher incomes and a
stronger economy. They include factors like the
cost of doing business, the incentives available, the
pool of talent, and available infrastructure to
support company operations. When these indicators
are positive, they greatly influence site selection
decisions and, ultimately, lead to stronger outputs.
The correlation between the inputs and the outputs
is important to keep in mind when reading this
report. Ultimately, the inputs are the factors over
which state leaders have the greatest amount of
control.This year’s benchmarking results can offer
continuing direction as we collectively evaluate the
next crucial decisions for our economy.
With all this in mind, readers of this benchmarking
report can see at a glance what progress has been
made, where Michigan ranks relative to the rest of
the U.S., and which direction we’re moving. The
key below shows you how.
Michigan’s
rank among
the 50 states,
with #1 being top
performance and
#50 being worst
performance in
the category.
Michigan’s level of
performance for the
most recent year
One-year trend
Average performance
of the “Top Ten” states
Positive Negative Holding
BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
2
5. 3
STATE
North Dakota
New York
Texas
Massachusetts
Wyoming
Washington
Alaska
Nebraska
Pennsylvania
Iowa
OVERAL
RANK
1
2
3
4
5
6
7
8
9
10
EMPLOYMENT
GROWTH2
1
2
4
8
10
14
5
16
11
7
EMPLOYMENT
LEVEL2
1
17
31
2
20
30
37
4
11
6
POPULATION
GROWTH
11
40
3
35
10
12
15
27
39
34
POPULATION
LEVEL
47
4
2
14
50
13
48
37
6
30
PER CAPITA
INCOME
GROWTH
1
9
6
17
2
24
4
15
18
14
PER CAPITA
INCOME
LEVEL
6
4
24
2
7
12
9
19
17
25
PER CAPITA
GDP
LEVEL
2
3
11
6
5
9
1
15
23
21
PER CAPITA
GDP
GROWTH
1
4
3
14
5
9
15
6
18
12
Top Ten States
WA
OR
CA
NV
UT
AZ
NM
CO
ID
MT
KS
OK
MN
MO
AR
LA
IL
IN
OH
KY
TN
MS AL GA
FL
SC
NC
VA
WV
ME
NH
NJ
DE
MD
DC
CT
RI
MA
WI
MI
HI
VT
Traditional Benchmarks
New Economy Benchmarks
Peer States
WA
OR
NV
UT
AZ
NM
WY
ID
MT ND
SD
NE
KS
OK
MN
IA
MO
AR
LA
KY
MS
FL
SC
WV
PA
NY
ME
NH
NJ
DE
MD
DC
CT
RI
MA
WI
MI
AK
HI
VT
ND
SD
NE
IA
TX
AK
NY
CA CO
IL
OH
TN
AL GA
NC
TX
IN
VA
WY
PA
Methodology, continued
Michigan’s performance on economic output and input
metrics is compared to selected traditional and new
economy peers and the “Top Ten” states.
Peer States were selected based on traditional
and new economy benchmarks.
Traditional Benchmarks
• Alabama • Indiana
• Georgia • Ohio
• Illinois • Tennessee
New Economy Benchmarks
• California • North Carolina
• Colorado • Texas
• Massachusetts • Virginia
“Top Ten” States1 were selected based on their average
ranking on key job, economic, personal income, and
population indicators (2004–2014). See chart below.
• Alaska • North Dakota
• Iowa • Pennsylvania
• Massachusetts • Texas
• Nebraska • Washington
• New York • Wyoming
“Top Ten” States for Job and
Economic Growth (2004-2014)
Over the last ten years, these states averaged the highest ranking across four basic indicators of jobs,
income, GDP, and population. In the report,“Top Ten” refers to this group of states and Michigan's
performance relative to their average performance. The table below looks at a weighted average rank for
both level and ten-year growth for these four categories.
BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
1 “Top Ten“ states have the highest average rankings across Per Capita GDP level and growth, Per Capita Personal Income level and growth, Employment level and growth,
and Population level and growth. 2014 “Top Ten” states Connecticut and South Dakota were replaced in the 2015 “Top Ten” by Pennsylvania and Washington.
2 Employment is measured per capita to control for state size.
6. BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
4
Key Findings
Output
In 2009, Michigan was headed in the wrong
direction across 11 key output indicators of
economic performance.
In 2014, Michigan was headed in the right
direction on most measures and ranked:
• 18th for employment growth
• 10th for per capita personal income growth,and
• 3rd for per capita gross domestic product growth.
Despite the fact that Michigan is growing
faster than most states, absolute levels for
employment, per capita income and per capita
GDP remain average or below.
While Michigan remains one of the 10 largest
states, population growth was slow, yielding a
ranking of only 41st nationwide.
20092014
0 2 4 6 8 10 12
Improving
Holding
11Declining
7Improving
1Holding
3Declining
46th
in
Unemployment
Rate
36th
in
Per Capita
Personal Income
34th
in
GDP Per Capita
Michigan’s absolute levels:
7. 5
Input - Cost
In 2009, Michigan was headed in the wrong
direction on 10 of 15 indicators relative to the
cost of being located in a given state.
In 2014, Michigan was headed in the right
direction on 11 of 15 measures, and ranked:
• 10th for corporate tax climate, and
• 13th for overall tax climate.
However this year, Michigan is trending in the
wrong direction for both economic
development expenditures and state unfunded
pension liabilities, and ranks 28th for both
measures.
Input -Value
Unlike outputs and cost inputs, Michigan was
doing better in 2009 on value inputs,
improving in 15 of 24 areas.
In 2014, Michigan’s performance was flat or
headed in the wrong direction on 15
measures, and ranked:
• 38th for 4th grade reading proficiency
• 39th for urban road conditions, and
• 41st for enrollment in high school career
and technical education.
While Michigan remains a Top Ten state for
innovation measures such as university
research and development and exports, recent
performance in those areas continues a
downward trend.
Michigan ranked in the bottom five states for
the percent of population age 25–34.
BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
20092014
0 2 4 6 8 10 12
2Improving
3Holding
10Declining
11Improving
1Holding
3Declining
20092014
0 5 10 15
15Improving
2Holding
7Declining
9Improving
5Holding
10Declining
8. BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
6
Unemployment Rate
Employment Growth
Labor Force Participation
Labor Force Growth
Per Capita Personal Income
Per Capital Personal Income Growth
Per Capita GDP
Per Capita GDP Growth
Michigan GDP/U.S. GDP
Population
Population Growth
Cost of Doing Business
Taxes
Corporate Tax Climate
Overall Business Tax Climate
Days Required to Pay Taxes
Labor
Unit Cost of Labor
Value Added Per Worker
Union Representation
Energy
Electricity Cost - Commercial
Electricity Cost - Industrial
Natural Gas Costs
Gasoline Costs
Total State & Local Spending
Local Debt Service
Econ Development Expenditures
Business Climate Rankings
Talent
4th Grade Reading
8th Grade Math
Secondary Career & Tech Ed Enrollment
Career & College Readiness
Out-of-State Enrollment
Degrees Conferred
Educational Attainment
Talent Migration (Residents w/BA+)
Median Age
Innovation
Exports
University R&D Expenditures
U.S. Patents per 100,000 Residents
Venture Capital Investment
Entrepreneurial Activity
Net New Establishments
Infrastructure
% of Urban Roads in Poor Condition
Broadband Penetration
Broadband Speeds
Place
% of Population Age 25-34
Commute Time
New Construction Permits
Violent Crime Rate
2009
Trend Top 10
2014 2009 2014
OUTPUTINPUT-CostINPUT-Value
Key Findings: Michigan’s Performance – 2009-2014
As measured by key outputs, Michigan’s economy is experiencing
“Top Ten” growth. Michigan has also taken steps to improve several
cost inputs, while more work is needed on key value inputs.
9. BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
7
Output Metrics
The end result of ongoing economic development and policy changes, output
metrics help measure the impact of economic choices. Output metrics focus on
areas indicative of strong economic performance: Employment, Per Capita GDP,
Population and Per Capita Income.
Michigan continues to grow jobs, incomes and its economy faster than most
other states and, in fact, ranks in the top ten for personal income and GDP
growth. But other states are not standing still. As impressive as Michigan’s
growth has been, it must accelerate even faster for the state to reach the
“Top Ten” in absolute terms.
output
18th
in
Employment
Growth
46th
in
Unemployment
Rate
34th
in
Per Capita GDP
36th
in
Per Capita
Personal Income
in
10th
in
Per Capita
Personal Income
Growth
3rd
Per Capita GDP Growth
Michigan continues to
grow faster than average
rate of “Top Ten” states
10. What it is:
Average share of the labor force that is
looking for work but does not have a job.
Why it matters:
A lower unemployment rate indicates that
more residents seeking employment are
able to find it.
In 2015, Michigan’s monthly
unemployment continued to
drop and in September was
5%, below the U.S. average.
Michigan’s annual
unemployment rate still
trailed most states in 2014
but showed substantial
improvement, dropping to
7.3% from 8.9% in 2013. Its
unemployment rate was over
2 percentage points higher
than the“Top Ten”average
and remained higher than all
of its peers except California.
Unemployment Rate Standings
Unemployment Rate
Bureau of Labor Statistics (Local Area Unemployment Statistics)
BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
8
UNEMPLOYMENT RATE
RANK
Level
46
7.3%
5.1%
th
TrendTop10Avg.
Unemployment Rate Trends
11. 9
output
Employment Growth Trends
What it is:
Average number of residents with a
private sector job.
Why it matters:
Higher levels of private employment
indicate both economic strength and
prosperity among the state’s residents.
Michigan’s private sector
employment growth was
slower, with the state
ranking 18th from 2013 to
2014. Michigan’s private
sector employment growth
rate was on par with the
“Top Ten” average, but came
behind six of its peers: Texas,
California, Colorado, North
Carolina, Tennessee and
Georgia.
Employment Standings
Bureau of Labor Statistics (Quarterly Census of Employment and Wages)
EMPLOYMENT GROWTH
RANK
Level
18
2.3%
2.3%
th
TrendTop10Avg.
Employment Growth
BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
12. Labor Force Participation
BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
10
Labor Force Participation Trends
What it is:
The share of the population age 16 and
older, not including residents who are on
active duty or institutionalized, that is
employed or looking for work.
Why it matters:
Members of the working-age population
stop looking for work and drop out of the
labor force due to many reasons, including
disability, old age, or discouragement.
Higher labor force participation is a sign of
a healthier economy and workforce.
Labor force participation
improved in Michigan from
2013 to 2014, a reversal of
the trend from the previous
year. The labor force
participation rate in
Michigan stood at six
percentage points less than
the “Top Ten” average and
three percentage points less
than the peer state average.
Labor Force Participation Standings
Bureau of Labor Statistics (Local Area Unemployment Statistics)
LABOR FORCE PARTICIPATION
RANK
Level
39
60.5%
66.7%
TrendTop10Avg.
th
13. What it is:
Change in the number of residents
employed or looking for work.
Why it matters:
Labor force includes the entire pool of
residents that are interested in working,
showing less volatility than employment
throughout the business cycle. A growing
labor force shows a growing pool of
workers for businesses.
The Michigan labor force
grew more slowly from 2013
to 2014 and now stands at
4.7 million. The increase in
Michigan’s labor force from
2013 to 2014 outpaced the
average increase for peer
states but was below the
average increase for the
“Top Ten” states.
Labor Force Standings
Labor Force Growth
Bureau of Labor Statistics (Local Area Unemployment Statistics)
11
output
LABOR FORCE GROWTH
RANK
Level
25
0.4%
0.7%
th
TrendTop10Avg.
Labor Force Growth Trends
BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
14. Per Capita Personal Income
BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
12
PER CAPITA PERSONAL INCOME GROWTH
RANK
Level
10
2.2%
1.4%
th
TrendTop10Avg.
Per Capita Personal Income Trends
What it is:
Personal income (2014 dollars) divided by
population. Personal income includes
salaries, wages, and bonuses from
employment; dividends and interest from
investments; rental income; pensions, etc.
Why it matters:
This is an indicator of prosperity and
average standard of living in a state.
Michigan’s per capita
income growth from 2013 to
2014 was the 10th fastest in
the nation—nearly twice as
fast as the “Top Ten” average
and faster than all of its
peers save Colorado.
However, its per capita
income level was below
more than half of its peers.
Per Capita Personal Income Standings
Bureau of Economic Analysis (personal income summary),
Bureau of Labor Statistics (CPI Inflation Calculator)
PER CAPITA PERSONAL INCOME
RANK
Level
36
$40,556
$51,300
th
TrendTop10Avg.
15. What it is:
Total amount of goods and services
produced by private industries in the
state, adjusted for inflation and changes
in relative prices, divided by population.
Why it matters:
Higher private sector GDP per capita is
one of the primary measures of a region’s
economic strength.
Michigan’s per capita GDP in
2013 was ranked in the
bottom half of states.
However, growth in Michigan’s
per capita GDP between 2013
and 2014 ranked 3rd in the
nation and was over four
times faster than the “Top
Ten” average. Michigan’s per
capita GDP remained below
most of its peers but its
growth over the past year
was faster than most.
Per Capita GDP Standings
Per Capita GDP
Bureau of Economic Analysis (personal income summary),
Bureau of Labor Statistics (CPI Inflation Calculator)
13
output
Per Capita GDP TrendsPER CAPITA GDP
RANK
Level
34
$37,593
$51,029
th
TrendTop10Avg.
PER CAPITA GDP GROWTH
RANK
Level
3
3.20%
0.73%
rd
TrendTop10Avg.
BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
16. BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
14
What it is:
Total amount of goods and services
produced in the state, as a share of all
goods and services produced in the
United States.
Why it matters:
A high share of United States GDP means
that much of the country's production is
occurring in that state, and can result in
higher incomes for state workers.
Since 2009, Michigan’s
share of U.S. GDP has
remained relatively flat at
2.6% after falling from a
high of 3% in 2005.
Michigan GDP/U.S. GDP Standings
Michigan GDP/U.S. GDP
Bureau of Economic Analysis
Michigan GDP/U.S. GDP TrendsPER CAPITA GDP
RANK
Level
34
$37,593
$51,029
th
TrendTop10Avg.
17. Population
POPULATION GROWTH
RANK
Level
41
0.1%
0.7%
st
TrendTop10Avg.
Population Trends
What it is:
Number of residents.
Why it matters:
Growth in population is an indicator for
how well a state attracts and retains
residents. It also affects a state’s ability to
support shared responsibilities such as
maintaining infrastructure and providing
education.
Michigan’s population
increased slightly from 2013
to 2014 and now ranks 10th
in the nation. Although its
population level is about
2 million higher than the
“Top Ten” average, population
growth was slower than all
of its peers except for Illinois.
Population Standings
U.S. Census Bureau (Population Estimates)
POPULATION
RANK
Level
10
9.910 M
8.035 M
th
TrendTop10Avg.
15
output
BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
18. Output Conclusions
Despite Michigan’s outstanding post-recession growth,
significant gaps remain between Michigan and “Top Ten” states
in job, income, and GDP levels.
Why is it important to be “Top Ten?”
Simply put, it would result in more jobs, better
incomes and a stronger economy. If Michigan was
performing like a “Top Ten” state today, there would be:
More Jobs: 120,000more Michigan people working
Higher incomes: $11,000 more income per person
Stronger economy: $13,000 more GDP per person
BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
16
20. BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
18
Input Metrics
In this report, Michigan’s input metrics are divided into two categories: cost indicators
and value indicators. When deciding whether nor not to locate or expand in a region,
job providers evaluate the costs (e.g., taxes, fees, utilities) of doing business in a
region relative to the value (e.g., talent, infrastructure) it provides. Ultimately, areas
that offer more value for equal or lower cost encourage business growth and
attraction which leads to more jobs, higher incomes, and a stronger economy.
Cost indicators represent a region’s basic level of competitiveness. States that are not
competitive on most cost factors don’t often get a second glance from job providers
looking to locate or expand their business.
Value indicators are what separate regions from one another when other factors are
equal. When comparing two or more regions with similar cost structures, the region
with better infrastructure, available talent, and innovation capabilities will often win.
When the relationship between cost and value indicators is positive, it can greatly
influence site selection decisions and, ultimately, lead to stronger outputs.
input
Cost Value
21. Moody's North American Business Cost Review (2012 data)
Cost of Doing Business
19
input
cost
Cost of Doing Business Trends
What it is:
Index that compares the state’s average
business costs (labor, energy, and state &
local tax burden) with the national
average (U.S. = 100).
Why it matters:
Lower business costs make it easier for
existing businesses to succeed and make
the state more attractive to new
businesses.
On average, businesses paid
more to operate in Michigan
than in “Top Ten” states and
peer states in 2012.
Michigan had the 12th
highest cost of doing
business in the nation. The
only peer states whose costs
of doing business exceeded
Michigan’s were California
and Massachusetts.
Index: Cost of Doing Business Standings
COST OF DOING BUSINESS
RANK
Level
105
98
TrendTop10Avg.
39
th
BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
22. Corporate Tax Climate
BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
20
Corporate Tax Climate Trends
What it is:
Index that compares corporate tax burden
based on corporate income tax and gross
receipts tax (10 = most favorable, 0 = least
favorable).
Why it matters:
A lower corporate tax burden can improve
a state’s attractiveness to both new and
existing businesses.
Michigan was among the
“Top Ten” states in terms of
corporate tax climate in
2014. Michigan’s corporate
tax climate rank exceeded all
of the “Top Ten” states except
Wyoming and tied for best
among peer states with
Virginia and Georgia.
Index: Corporate Tax Climate Standings
Tax Foundation (2014 State Business Tax Climate Index)
CORPORATE TAX CLIMATE
RANK
Level
10
5.8
5.3
thTrendTop10Avg.
23. What it is:
Rankings are based on the overall tax
index and component tax indices
(corporate tax, individual income tax,
sales tax, unemployment insurance tax,
and property tax) (1 = lowest tax burden,
50 = highest tax burden).
Why it matters:
These measures indicate how attractive a
state might be to both businesses and
individuals in terms of common tax
burdens.
Michigan’s overall business
tax climate index ranking
rose from 14th in 2014 to
13th in 2015. The average
rank for “Top Ten” states
was 23. Michigan has
remained more competitive
than all of its peer states in
terms of its overall tax
climate with the exception
of Indiana and Texas.
Note: data for corporate and overall business tax climate
rankings use different indices.
Index: Overall Business Tax Climate Standings
Overall Business Tax Climate
Tax Foundation (2014 State Business Tax Climate Index)
21
input
cost
OVERALL BUSINESS TAX CLIMATE
RANK
Level
13
13
23
th
TrendTop10Avg.
Overall Business Tax Climate Trends
BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
24. BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
22
Days Required to Pay Taxes
Days Required to Pay Taxes Trends
What it is:
The number of days a year that represent
the portion of the year's earnings that are
paid in federal, state, and local taxes.
Why it matters:
Lower tax burdens mean more take-home
income for state residents.
Michigan’s days to pay taxes
has increased by three days
in each of the past two years.
This trend is roughly in line
with the trend in other
states, largely due to
increases in federal taxes.
Days Required to Pay Taxes Standings
Tax Foundation
DAYS REQUIRED TO PAY TAXES
RANK
Level
110
114
TrendTop10Avg.
26
th
25. Labor
Labor Trends
What it is:
Private industry compensation divided by
private sector GDP (both in current dollars).
Why it matters:
The share of output that is paid to workers
indicates the “value proposition” for
employers of Michigan workers. Lower unit
labor costs make a state a more attractive
environment to operate.
Michigan’s unit cost of labor
has remained relatively flat
over the past four years and
was approximately 15%
higher than the “Top Ten”
average in 2013. The unit
cost of labor in Michigan
was higher than all of its
peer states except
Massachusetts.
Labor Standings
Bureau of Economic Analysis (Real GDP by State, Compensation of
Employees - 2012 data)
UNIT COST OF LABOR
RANK
Level
42
$0.52
$0.45
nd
TrendTop10Avg.
23
BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
26. What it is:
Real Private Industry GDP divided by
average annual non-farm employment.
Why it matters:
This is a measure of the amount of
production per worker, which is an
important way to increase income and
economic activity.
Value added per worker
in Michigan was 15% lower
than the “Top Ten” average
in 2014 and ranked below
all but four of its peer
states. However, the growth
in worker productivity in
Michigan from 2013 to
2014 exceeded that of over
half of its peer states.
Value Added Per Worker Standings
Value Added Per Worker
Bureau of Economic Analysis (Real GDP by State), Bureau of Labor Statistics
(State and Metro Area Employment, Hours, and Earnings)
VALUE ADDED PER WORKER
RANK
Level
24
$89,130
$105,000
th
TrendTop10Avg.
Value Added Per Worker Trends
BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
24
27. 25
input
costBusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
Union Representation
Union Representation Trends
What it is:
Employees represented by a union (as a
percent of those employed) (1 = best, 50 =
worst).
Why it matters:
An indicator of labor market bargaining
power, labor flexibility, and pro-business
sentiments in the state. For some
employers, lower union membership makes
a state a more attractive place to operate.
Michigan had the 11th-
highest share of workers that
are represented by a union
in 2014. Michigan’s
unionization rate was two
percentage points higher
than the “Top Ten” average.
Michigan’s union
membership and
representation rate remained
higher than all peer states
except California and Illinois.
Union Representation Standings
Bureau of Labor Statistics (Current Population Survey)
UNION REPRESENTATION
RANK
Level
39
15.7%
13.9%
th
TrendTop10Avg.
28. BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
26
What it is:
Price per kilowatt-hour (kwh) of
electricity for commercial users (1 = best,
50 = worst).
Why it matters:
Maintaining competitive energy costs
contributes to a state’s attractiveness to
businesses.
Michigan’s electricity costs
for commercial customers
were even with the“Top
Ten”average in 2014. This
represented a decline of
0.2¢ relative to 2013 for
Michigan. Electricity costs
for commercial customers in
Michigan are higher than
those in all peer states
except Massachusetts and
California but only 2%
above the national average.
Note: 2015 rates are based on monthly reported data
through August.
Electricity Costs - Commercial Standings
Electricity Costs - Commercial
Energy Information Administration
ELECTRICITY COSTS: COMMERCIAL
RANK
Level
33
10.3¢
11.0¢
rd
TrendTop10Avg.
Electricity Costs - Commercial Trends
29. 27
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What it is:
Price per kilowatt-hour (kwh) of
electricity for industrial users (1 = best,
50 = worst).
Why it matters:
Maintaining competitive energy costs
contributes to a state’s attractiveness to
businesses.
Michigan’s electricity costs
for industrial users were
0.3¢ lower than the “Top
Ten” average in 2014, and
remained flat while the
average for “Top Ten” states
rose by 0.1¢. While
electricity costs for industrial
customers in Michigan are
higher than most peers, in
2015 Michigan’s rates are
dropping significantly faster
than the peer average.
Note: 2015 rates are based on monthly reported data
through August.
Electricity Costs - Industrial Standings
Electricity Costs - Industrial
Energy Information Administration
ELECTRICITY COSTS: INDUSTRIAL
RANK
Level
29
7.0¢
8.2¢
th
TrendTop10Avg.
Electricity Costs - Industrial Trends
30. BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
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What it is:
A weighted average of the price per
thousand cubic feet of natural gas for
Industrial and Commercial users,
weighted by the proportion of
consumption from each sector.
Why it matters:
Maintaining competitive energy costs
contributes to a state’s attractiveness to
businesses.
Michigan’s natural gas
prices have been falling
every year since 2008, but
are still higher than the
average of the “Top Ten”
states and all of its peer
states, except for
Massachusetts and North
Carolina.
.
Natural Gas Costs Standings
Natural Gas Costs
U.S. Energy Information Administration
NATURAL GAS COSTS
RANK
Level
25
7.52¢
7.17¢
th
TrendTop10Avg.
Natural Gas Costs Trends
31. 29
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What it is:
The price per gallon of fuel for all users,
converted from price per BTU.
Why it matters:
Maintaining competitive energy costs
contributes to a state’s attractiveness to
businesses.
Michigan’s price for
gasoline fell from last year
and is lower than the
average price for “Top Ten”
and peer states.
Gasoline Costs Standings
Gasoline Costs
U.S. Energy Information Administration
GASOLINE PRICES
RANK
Level
16
3.52¢
3.72¢
th
TrendTop10Avg.
Gasoline Costs Trends
32. BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
30
State Unfunded Pension Liabilities
Unfunded Pension Liability Trends
What it is:
State government unfunded pension and
other postemployment benefit liability
(UAAL) divided by population.
Why it matters:
This measure indicates the burden of
unfunded retiree benefits on taxpayers.
Payments for high unfunded liabilities may
crowd out spending for competing needs,
such as infrastructure and education.
Michigan’s unfunded pension
liability per capita was less
than the “Top Ten” average
in 2013.
Unfunded Pension Liability Standings
Census of Governments, Pew Center on the States
STATE UNFUNDED PENSION LIABILITIES
RANK
Level$3,311
$3,372
TrendTop10Avg.
28
th
33. 31
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OPEB Liability Trends
What it is:
State government unfunded other
postemployment benefit liability (OPEB)
divided by population.
Why it matters:
This measure indicates the burden of
unfunded retiree benefits on taxpayers.
Payments for high unfunded liabilities
may crowd out spending for competing
needs, such as infrastructure and
education.
Michigan’s OPEB unfunded
liability per capita was less
than the “Top Ten” average
in 2012, but over $700 per
person higher than the
average of peer states.
Note: “Top Ten” average for OPEB excludes Nebraska due to
data availability. Cannot make inter-year comparisons for
OPEB due to use of a different data source for 2012.
OPEB Liability Standings
State Unfunded Non-Pension (OPEB) Liabilities
Census of Governments, Pew Center on the States
STATE UNFUNDED OPEB LIABILITIES
RANK
Level
41
$2,384
$2,473
st
TrendTop10Avg.
34. BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
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Local Debt Service
Local Debt Service Trends
What it is:
Local government interest payments on
debt, divided by local government direct
expenditures (both in current dollars).
Why it matters:
Maintaining debt service at low levels is an
indicator of fiscal sustainability.
Local government interest on
debt in Michigan exceeded
the“Top Ten”average and
ranked in the bottom half of
the nation. However, it was
relatively constant from 2009
to 2012. Michigan is on par
with its peer average, and
only Illinois, Colorado, North
Carolina, and Texas had
higher local government
interest spending than
Michigan.
Note: This measure does not include debt service on principal
since the Census of Governments does not report a direct debt
service measure.
Local Debt Service Standings
Census of Governments (Annual Survey of State and Local Government Finances)
LOCAL DEBT SERVICE
RANK
Level
32
4.4%
3.9%
ndTrendTop10Avg.
35. 33
input
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Total State & Local Spending
Total State & Local Spending Trends
What it is:
Total state and local government
expenditures (2014 dollars) divided by
population (1 = best, 50 = worst).
Why it matters:
State and local government expenditures
are used for important investments in
education, infrastructure, and public safety.
On the other hand, high expenditures can
crowd out private sector economic activity
by redirecting tax revenue and state
workers away from private use.
Michigan’s state and local
spending was 28% lower
than the “Top Ten” average
in 2012. Michigan was also
4% below average among its
peer states. The growth in
per capita government
spending in Michigan was
4th lowest in the nation over
the preceding decade and
second behind only Georgia
among its peer states.
Total State & Local Spending Standings
Census of Governments (Annual Survey of State and Local Government Finances)
TOTAL STATE & LOCAL SPENDING
RANK
Level
$9.30
$12.93
TrendTop10Avg.
19
th
36. What it is:
State and local government expenditures
on economic development programs and
incentives (2014 dollars), divided by
population.
Why it matters:
This measure indicates the total scale of
public spending on economic development
programs and incentives in a state.
Michigan’s economic
development expenditures
per capita in 2014 were
40% of the “Top Ten”
average. Michigan’s
economic development
expenditures declined from
2013 to 2014 while the
“Top Ten” average stayed
relatively constant. Although
Michigan was ranked 6th
among its peers in terms
of the level of economic
development expenditures,
it was still 15% above the
peer state average.
Economic Development Expenditures
Standings
Economic Development Expenditures
Council for Community and Economic Research (State Economic Development
Expenditures Database)
BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
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ECON. DEV. EXPENDITURES
RANK
Level
28
$21.97
$52.76
thTrendTop10Avg.
Economic Development Expenditures Trends
37. 35
input
costBusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
What it is:
Average of three major business climate
indices that account for several factors
such as business costs, business leaders’
perceptions, regulatory climate, quality of
life, etc. (1 = best, 50 = worst).
Why it matters:
This measure is an indicator for how
attractive a state might be for businesses.
Michigan’s average ranking
across three major business
climate indices improved by
three spots from 2013 to
2014, but still remained in
the bottom 15 states.
Michigan’s average ranking
was below all peer states
except Illinois and
California.
Index: Business Climate Ranking Standings
Business Climate Rankings
CEO Magazine (Best and Worst States for Business),
CNBC (Top States for Business), Forbes (Best States for Business)
BUSINESS CLIMATE RANKINGS
RANK
Level
38
37.7
21.5
th
TrendTop10Avg.
Business Climate Rankings Trends
38. 4th Grade Reading
BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
36
4th Grade Reading Trends
What it is:
Average score for reading proficiency
among 4th graders, relative to the base
score (41.6% = basic, 47.6% = proficient).
Why it matters:
This provides an indicator of how well
schools are meeting competitive academic
standards.
Michigan 4th graders are
performing below both the
“Top Ten” average and the
peer state average in reading
by about one percentage
point. Both the Michigan
average and the “Top Ten”
average exceeded the “basic”
level, but fall short of the
“proficient” level. Michigan
scores have declined since
2007 and were among the
bottom half among all states.
Michigan’s 4th grade reading
scores were outranked by all
peer states except California
and Texas.
4th Grade Reading Standings
National Center for Education Statistics
(National Assessment of Educational Progress)
4TH GRADE READING
RANK
Level
38
43.4%
44.6%
thTrendTop10Avg.
39. What it is:
Average score for mathematics
proficiency among 8th graders, relative to
the base score (52.4% = basic, 59.8% =
proficient).
Why it matters:
This provides an indicator of how well
schools are meeting competitive
academic standards.
Michigan 8th graders
performed below the“Top
Ten”average in mathematics
by 1.6 percentage points,
and below the peer state
average by 0.9 percentage
points. Both the Michigan
average and the “Top Ten”
average exceeded the “basic”
level, but fall short of the
“proficient” level. Michigan
scores have improved over
the past decade, but were
still in the bottom half of the
nation and were outranked
by over half of peer states.
8th Grade Math Standings
8th Grade Math
National Center for Education Statistics
(National Assessment of Educational Progress)
37
input
value
8TH GRADE MATH
RANK
Level
37
56.0%
57.6%
th
TrendTop10Avg.
8th Grade Math Trends
BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
40. Career & Technical Education Enrollment
BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
38
Career & Technical Education Enrollment Trends
What it is:
The average number of career-oriented
and/or technical education classes in which
public high school students are enrolled.
Why it matters:
Serves as a measure of how well high
school students are being prepared for
highly-skilled technical professions.
Less than one in four
students in public high
schools in Michigan was
enrolled in a career or
technical education class in
2014. This is less than half
of both the “Top Ten” and
peer states average.
Career & Technical Education Enrollment Standings
Association for Career and Technical Education
SECONDARY TECHNICAL ENROLLMENT
RANK
Level
41
0.23
0.55
stTrendTop10Avg.
41. 39
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What it is:
Percent of students tested that met or
exceeded the ACT College Readiness
Benchmarks in all four subjects (English,
reading, mathematics, science).
Why it matters:
This is an indicator of how well-prepared
high school graduates are for entering
college and future careers.
The percentage of college-
and career-ready graduates
in Michigan improved by one
percentage point from 2013
to 2014, but is about 11
percentage points lower than
the “Top Ten”average.
Michigan was among the
bottom half of states in terms
of college-ready graduates
and was outranked by all
but three of its peer states:
Alabama, Tennessee, and
North Carolina.
Career & College Readiness Standings
Career & College Readiness
ACT College and Career Readiness Benchmarks
CAREER & COLLEGE READINESS
RANK
Level
35
22.0%
32.6%
th
TrendTop10Avg.
Career & College Readiness Trends
42. BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
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Out-of-State Enrollment
Out-of-State Enrollment Trends
What it is:
Percent of entering first-year
undergraduates from out of state.
Why it matters:
This indicates how well higher education
institutions are attracting students from
out of state to provide an infusion of talent
and capital. This should be compared with
in-state enrollment to ensure that states
are maintaining in-state enrollment.
The rate of out-of-state
enrollment at higher
education institutions in
Michigan was less than half of
the“Top Ten”average in 2012
and trailed all but four states in
the nation. However, Michigan’s
out-of-state enrollment rate
grew by 1.2 percentage-points
from 2010 to 2012 compared
to the “Top Ten” average.
Among peer states, only
institutions in California and
Texas have lower out-of-state
enrollment rates than
Michigan.
Out-of-State Enrollment Standings
National Center for Education Statistics Integrated Postsecondary Education
Data System, U.S. Census Bureau Population Estimates (2012 data)
OUT-OF-STATE ENROLLMENT
RANK
Level
46
11.7%
28.1%
th
TrendTop10Avg.
43. 41
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What it is:
Total associate, bachelor’s, master’s, and
doctorate degrees conferred per 10,000
residents by public and private institutions.
Why it matters:
Number of students earning a degree
each year. Educational attainment is a
factor in accessing the quality of a state’s
talent pool.
The number of degrees
conferred by higher
education institutions in
Michigan has been
increasing, but remained
below the “Top Ten” average
by about 10% in 2014.
Michigan was near the
middle of its peers but above
average in terms of the
number of degrees conferred
per 10,000 of population.
Note: Degrees include associate, bachelor’s, and
graduate/professional degrees. Higher education institutions
include all public and private degree-granting institutions.
Degrees Conferred Standings
Degrees Conferred
Associate’s+ Per 10,000
National Center for Education Statistics (Integrated Postsecondary
Education Data System), U.S. Census Bureau (Population Estimates)
DEGREES CONFERRED
RANK
Level
23
201
224
rd
TrendTop10Avg.
Degrees Conferred Trends
44. BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
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Technical Education
Critical Skills Degrees & Certificates
Technical Education Trends
What it is:
Total critical skills degrees and certificates
conferred divided by the working age
population (ages 20 through 64, inclusive).
Why it matters:
These degrees especially prepare students
for high-skilled occupations, particularly in
the STEM fields, which are the types of
jobs Michigan expects to increase in the
future.
The number of critical skills
degrees and certificates
awarded in Michigan per
capita has increased by over
50% since 2005. However,
the level of degrees awarded
is still 12% lower than the
“Top Ten” average in 2014.
Michigan also came in 6th
among its peers in terms of
the level of critical skills
degrees and certificates
awarded.
Note: Higher education institutions include all public and
private degree-granting institutions.
Technical Education Standings
National Center for Education Statistics (Integrated Postsecondary
Education Data System), U.S. Census Bureau (Population Estimates)
CRITICAL SKILLS DEG. & CERT.
RANK
Level
27
95.8
109.4
th
TrendTop10Avg.
45. 43
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What it is:
Share of residents aged 25 to 64 with an
associate degree or higher.
Why it matters:
The availability of highly educated talent
can promote future growth of the
economy, particularly in highly skilled
professions.
The level of highly educated
talent available in Michigan
has increased by about 14
percentage points in the
last decade, but was four
percentage points lower
than the “Top Ten” average
in 2013. Michigan was
among the bottom half
of states in terms of
educational attainment
and was outranked by
half of its peer states.
Educational Attainment Standings
Educational Attainment
Population age 25-64 with Associates+
U.S. Census Bureau (American Community Survey)
EDUCATIONAL ATTAINMENT
RANK
Level
31
38.4%
42.4%
st
TrendTop10Avg.
Educational Attainment Trends
46. BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
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Talent Migration
Educated Adults with BA+
Talent Migration Trends
What it is:
Immigrants with a bachelor’s degree or
higher minus emigrants with a bachelor’s
degree or higher.
Why it matters:
This measure indicates how well a state
attracts and retains highly educated
individuals to live in the state.
2013 marked the second
consecutive year in which
Michigan had a net positive
migration of talented
individuals after five prior
years of net losses. However,
the net migration of educated
residents in Michigan was
lower than the “Top Ten”
average. Michigan gained
highly educated residents at
a slower pace in 2013 than
it had the year before, and
ranked third from the bottom
among peer states.
Talent Migration Standings
U.S. Census Bureau (American Community Survey)
TALENT MIGRATION
RANK
Level2,838
10,562
TrendTop10Avg.
28
th
47. 45
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Median Age
Median Age Trends
What it is:
Median age of state residents.
Why it matters:
Increase in the median age is an indicator
of an aging population, where the
population growth rate of middle age and
senior citizens outpaces that for children
and young adults. States with a high
median age among residents may be good
at attracting retirees, but it also can be a
sign that younger people are seeking out
other places to work and raise a family.
Michigan was among the top
10 oldest states in 2013,
with the ninth-highest
median age. Michigan’s
median age increased
slightly from 2012 to 2013,
rising by 0.1 years. This
continues a trend that has
seen the Michigan median
age increase by 2.7 years
since 2005. Michigan’s
median age was higher than
all of its peers and all of the
“Top Ten” states except for
Pennsylvania.
Median Age Standings
U.S. Census Bureau (Population Estimates)
MEDIAN AGE
RANK
Level
41
39.6
36.9
st
TrendTop10Avg.
48. What it is:
Total value of goods originating in a
state that were shipped out of the
country, as a share of total GDP.
Why it matters:
Exports help support jobs and growth
of the state economy.
Michigan had the 6th-
highest value of exports
(scaled by GDP) in 2014
when considering all goods,
and 7th when considering
only manufactured goods.
The level of exports from
Michigan exceeded the “Top
Ten” average and those of
all “Top Ten” states except
Texas and Washington.
Michigan was only second
to Texas among its peer
states in terms of the value
of both all goods and
manufactured goods.
Export Standings
Exports
Per $100,000 of GDP
U.S. Department of Commerce (TradeStats Express)
BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
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EXPORTS
RANK
Level
6
$12,348
$9,536
thTrendTop10Avg.
Export Trends
49. 47
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University R&D Expenditures
Per $1M of GDP
University R&D Expenditure Trends
What it is:
Research and development expenditures
by higher education institutions, as a
share of total GDP.
Why it matters:
Research and development expenditures by
universities improve the state’s attractiveness
to out-of-state students and talent, and
provide an important source of innovation
and entrepreneurship in the state.
Research and development
expenditures at universities
in Michigan were 6th in the
nation in 2013 and were
higher than all of the“Top Ten”
states except Massachusetts.
Michigan universities’
research and development
expenditures were greater
than those of all of its peers
except Massachusetts and
North Carolina.
University R&D Expenditure Standings
National Science Foundation Higher Education R&D Expenditures by State,
Bureau of Economic Analysis Real GDP by State
UNIVERSITY R&D EXPEND
RANK
Level
6
$5,879
$4,740
th
TrendTop10Avg.
50. What it is:
Number of U.S. patents awarded per
100,000 residents.
Why it matters:
Patents provide an incentive for
innovators and entrepreneurs to improve
technology. The states whose residents
are the source of this innovation have an
advantage in reaping the economic
benefits derived from them.
Michigan ranked 12th in
the nation in terms of
patents per capita and
exceeded the “Top Ten”
average. Michigan inventors
were more prolific than
those for all of its peers
except Massachusetts,
Colorado, and California on
a per capita basis.
U.S. Patent Standings
U.S. Patents
Per 100,000 Residents
U.S. Patent and Trademark Office (Patents By Country, State, and Year -
Utility Patents), U.S. Census Bureau (Population Estimates)
BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
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US PATENTS
RANK
Level
12
53.5
39.8
thTrendTop10Avg.
U.S. Patent Trends
51. 49
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Venture Capital Investment
Per $100,000 of GDP
Venture Capital Investment Trends
What it is:
Total capital infusions by venture capital
funds and investors per $100,000 in
nominal GDP.
Why it matters:
This measure indicates a state’s leadership
in innovation and entrepreneurship and
ability to attract funding for high-risk firms.
This is a volatile indicator.
Venture capital investment
in Michigan in 2014 was
nearly double the level in
2013, but still below the
level in 2012. It was also
significantly lower than the
“Top Ten” average, both in
terms of level and growth.
Venture capital investment
in Michigan was behind all
of its peer states except for
Indiana, Ohio, and Alabama.
Venture Capital Investment Standings
Pricewaterhouse Coopers / National Venture Capital Association
(MoneyTree™ Report)
VENTURE CAPITAL INVESTMENT
RANK
Level
25
$55.14
$210.41
th
TrendTop10Avg.
52. What it is:
Kauffman Index of Entrepreneurial
Activity (the share of individuals age 20
to 64 who previously did not own a
business and subsequently started a
business with 15 or more hours worked
during the year).
Why it matters:
This measure indicates the number of
entrepreneurs in the state. Greater
entrepreneurship, in the right
environment, can lead to more
innovation and more successful
businesses in the state.
Entrepreneurial activity in
Michigan was slightly
below the “Top Ten” average
in 2014. Entrepreneurial
activity in Michigan ranked
in the middle of its peers in
2014, after ranking near the
bottom of its peers in 2012.
Entrepreneurial Activity Standings
Entrepreneurial Activity
Ewing Marion Kauffman Foundation (Kauffman Index of
Entrepreneurial Activity)
BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
50
ENTREPRENEURIAL ACTIVITY
RANK
Level0.26%
0.29%
TrendTop10Avg.
31
st
Entrepreneurial Activity Trends
53. 51
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Net New Establishments
Net New Establishments Trends
What it is:
The number of new businesses opened
during the year less the number of
businesses which closed.
Why it matters:
Independent of employment, new business
creation can provide economic growth, a
more stable economic foundation, and a
more diverse economy.
In 2012 and 2013, Michigan
had a net increase in the
number of business
establishments for the first
time in a long while.
However, business creation
remained very low, with
Michigan ranking 10th
among its peers and far
below the “Top Ten” average.
Net New Establishments Standings
U.S. Census Bureau (County Business Patterns)
NET NEW ESTABLISHMENTS
RANK
Level
36
54
1,920
th
TrendTop10Avg.
54. What it is:
The number of new, privately owned,
housing units authorized for construction
per 1,000 residents.
Why it matters:
This measure indicates how quickly new
housing stock is being created in the
state—a proxy for growing population
and household formation, and a source of
economic growth.
Permits for new construction
in Michigan have improved
in recent years but remain
far below pre-recession
levels. There were fewer new
construction permits issued
per capita in Michigan than
in all “Top Ten” states and all
peer states except for Illinois.
New Construction Permit Standings
New Construction Permits
U.S. Census Bureau
BusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
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NEW CONSTRUCTION PERMITS
RANK
Level
46
1.6
4.6
thTrendTop10Avg.
New Construction Permit Trends
55. 53
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Average Earnings in
economy sectors
Average Earnings Trends - New Michigan sectors
What it is:
Average annual earnings (in 2014 dollars),real
GDP, and employment as a share of working-
age population in the engineering,geographic
trade, higher education, life sciences,
automotive, and natural resources sectors.
Why it matters:
These six sectors represent major
opportunities crucial for growing Michigan’s
economy,and moving it forward in the new
global economy.These three major indicators
(GDP, employment, and earnings) show how
these sectors are contributing to a state’s
production and to residents' well-being.
While earnings in the
industries that have been
identified as New Michigan
opportunities remain well
above the average earnings
in Michigan, they have been
stagnant from 2011 to 2013.
In earnings, employment, and
GDP for these sectors,
Michigan ranks in the middle
of the pack among its peers
and below the “Top Ten”
average.
Average Earnings Standings -New Michigan sectors
New Michigan: The 2015 Report on Michigan's Progress in
Leveraging Six Opportunities
AVERAGE EARNINGS
RANK
Level
14
$63,234
$64,593
th
TrendTop10Avg.
newmichigan
56. What it is:
Average annual earnings (in 2014
dollars), real GDP, and employment as a
share of working-age population in the
engineering, geographic trade, higher
education, life sciences, automotive, and
natural resources sectors.
Why it matters:
These six sectors represent major
opportunities crucial for growing
Michigan’s economy, and moving it
forward in the new global economy.
These three major indicators (GDP,
employment, and earnings) show how
these sectors are contributing to a state’s
production and to residents' well-being.
In real GDP among the
industries that have been
identified as New Michigan
opportunity industries,
Michigan has improved
considerably over the past
few years. In earnings,
employment, and GDP,
Michigan ranks in the
middle of the pack among
its peers and below the
“Top Ten” average.
GDP Per Capita - New Michigan Standings
GDP Per Capita in
economy sectors
New Michigan: The 2015 Report on Michigan's Progress in
Leveraging Six Opportunities
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GDP PER CAPITAL – NEW MI
RANK
Level
22
$7,973
$14,187
nd
TrendTop10Avg.
GDP Per Capita - New Michigan Trends
newmichigan
57. 55
input
valueBusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
Employment/Working Age Population in
economy sectors
Employment/Working Age Population Trends
What it is:
Average annual earnings (in 2014 dollars),
real GDP, and employment as a share of
working-age population in the
engineering, geographic trade, higher
education, life sciences, automotive, and
natural resources sectors.
Why it matters:
These six sectors represent major
opportunities crucial for growing
Michigan's economy, and moving it forward
in the new global economy. These three
major indicators (GDP, employment, and
earnings) show how these sectors are
contributing to a state's production and to
residents' well-being.
Michigan has improved
considerably over the past
few years. In employment
among the industries that
have been identified as New
Michigan opportunity
industries. Michigan ranks in
the middle of the pack
among its peers and below
the “Top Ten” average.
Employment/Working Age Population Standings
New Michigan: The 2015 Report on Michigan's Progress in
Leveraging Six Opportunities
EMPLOYMENT PERCENTAGE
RANK
Level
23
13.2%
16.1%
rd
TrendTop10Avg.
newmichigan
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Urban Roads in Poor Condition
Urban Roads in Poor Condition Trends
What it is:
Share of urban roads in poor condition, by
length.
Why it matters:
A strong, reliable transportation system
benefits both businesses and individuals.
Poor road quality imposes many tangible
costs and reduces productivity.
The percentage of poor-
quality urban roads in
Michigan increased from
2012 to 2013. Urban road
quality was worse in
Michigan than the “Top Ten”
average, and Michigan
ranked 39th among all
states. Among peers,
only Massachusetts and
California have a greater
percentage of urban roads
in poor condition.
Note: Includes interstate highways, freeways, expressways, and
major arterial roads in urban areas.
Urban Roads in Poor Condition Standings
U.S. Department of Transportation Federal Highway Administration
(Length by measured pavement roughness, all systems)
URBAN ROADS IN POOR CONDITION
RANK
Level
39
13.3%
11.8%
th
TrendTop10Avg.
59. 57
input
valueBusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
U.S. Department of Transportation Federal Highway Administration
(Area of bridges by Functional Classification)
What it is:
Percent of bridges in deficient condition,
by area.
Why it matters:
A strong, reliable transportation system
benefits both businesses and individuals.
Poor bridge quality imposes many
tangible costs and reduces productivity.
The share of bridges
categorized as deficient in
Michigan has declined
considerably over the past
10 years, declining at a
considerably higher rate
than that for the “Top Ten”
average and for peer states.
However, the share of
bridges that are deficient in
Michigan remains above
those two averages.
Michigan has a higher share
of deficient bridges than all
peer states except California
and Massachusetts.
Deficient Bridge Standings
Deficient Bridges
DEFICIENT BRIDGES
RANK
Level
42
33.5%
32.0%
nd
TrendTop10Avg.
Deficient Bridge Trends
60. Akami
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Broadband Speeds
Broadband Speed Trends
What it is:
Average speed for downloading and
uploading information, in kilobits per
second.
Why it matters:
Strong telecommunications
infrastructure can improve productivity
and is attractive for businesses.
Average connection speeds
in Michigan in 2014 were
higher than the“Top Ten”
average. The state ranked
10th nationally. Michigan
ranked third among its
peers behind Massachusetts
and Virginia.
Broadband Speed Standings
INTERNET CONNECTION SPEEDS
RANK
Level
10
12,379
10,939
th
TrendTop10Avg.
61. 59
input
valueBusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
What it is:
The percent of households with high-
speed Internet connections, based on
household survey data.
Why it matters:
Access to Internet at home makes it
easier for students, workers, and
entrepreneurs to stay connected.
The number of households
with access to quality
internet service increased
by 25 percentage points
between 2007 and 2013.
However, Michigan still ranks
below the averages of both
“Top Ten”and peer states.
Broadband Penetration Standings
Broadband Penetration
U.S. Census Bureau
BROADBAND PENETRATION
RANK
Level
38
70.7%
75.0%
th
TrendTop10Avg.
Broadband Penetration Trends
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Population Age 25-34
Population Age 25-34 Trends
What it is:
The percent of a state’s population
between the ages of 25 and 34.
Why it matters:
Growth in prime working-age population
is an indicator for how well a state
attracts and retains workers. This affects
a state’s ability to grow, attract
businesses, and maintain public
infrastructure and programs.
The percent of young
working-age people has
remained very flat in
Michigan, though with slight
increases over the last four
years (0.1 percentage points
per year). Michigan has the
lowest % of population age
25-34 among all of its peers
and lags the “Top Ten”
average by well over a
percentage point.
Population Age 25-34 Standings
U.S. Census Bureau (Population Estimates)
POPULATION AGE 25-34
RANK
Level
46
12.1
13.8
th
TrendTop10Avg.
63. 61
input
valueBusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
What it is:
The average number of minutes it takes
for a worker to travel to and from work.
Why it matters:
A shorter commute time means easier
access to jobs for workers and less
productive time wasted during
commutes.
Michigan ranks in the
middle of all states for
commute time, with slightly
longer commutes than the
“Top Ten” average, but
shorter commutes than nine
of its peer states.
Commute Time Standings
Commute Time
US Census Bureau
COMMUTE TIME
RANK
Level
28
24.0
22.7
th
TrendTop10Avg.
Commute Time Trends
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Violent Crime Rate
Violent Crime Rate Trends
What it is:
The number of violent crimes per
100,000 residents.
Why it matters:
Lower violent crime means a safer living
and working environment, making the
state a more attractive to place to live
and start a business.
Violent crime rates in
Michigan increased slightly
from 2012 to 2013, but
remain far below the rates
of five to 10 years ago.
That said, Michigan violent
crime rates are above the
“Top Ten” average and
higher than all peer states
except Tennessee.
Violent Crime Rate Standings
FBI Crime Statistics
VIOLENT CRIME RATE
RANK
Level
39
454.5
343.8
th
TrendTop10Avg.
65. States that prohibit discrimination based on
sexual orientation and gender identity
WA
OR
CA
NV
UT
AZ
NM
CO
WY
ID
MT ND
SD
NE
KS
OK
MN
IA
MO
AR
TX
LA
IL
IN
OH
KY
TN
MS AL GA
FL
SC
NC
VA
WV
PA
NY
ME
NH
NJ
DE
MD
DC
CT
RI
MA
WI
MI
AK
HI
VT
States that prohibit discrimination based on
sexual orientation only
States that prohibit discrimination based on
gender identity only
63
input
valueBusinessLeadersforMichiganI2015EconomicCompetitivenessBenchmarkingReport
Non-Discrimination Policies
What it is:
Indicator for whether the state
prohibits employment-related
discrimination based on sexual
orientation.
Why it matters:
Protections against employment-
related discrimination facilitate a
welcoming environment for workers.
Michigan does not prohibit
employment-related
discrimination based
on sexual orientation.
Only four of the “Top Ten”
states and only four of the
twelve peer states prohibit
employment-related
discrimination based on
sexual orientation. American Civil Liberties Union
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Input Conclusions
Michigan has achieved Top Ten performance on cost inputs
such as Business and Overall Tax Climates and is trending
positive on Labor and Energy cost inputs.
Michigan’s performance on key value inputs is mixed with
strengths in innovation areas such as University Research
and Development, Exports and Patents. Michigan’s
performance is in the bottom third of states on several
talent measures, including 4th grade reading, career- and
college-ready graduates, out-of-state enrollment, and
educational attainment.
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66
KEWEENAWW
ONTONAGON
GOGEBIC
IRON
BARAGA
MARQUETTE
DICKINSON
MENOMINEE
DELTA
ALGER
SCHOOLCRAFT
LUCE
MACKINAC
CHIPPEWA
EMMET
CHEBOYGAN
PRESQUE ISLE
CHARLEVOIX
ALPENA
MONTMORENCY
OTSEGANTRIM
LEELANAU
BENZIE
GRAND
TRAVERS
KALKASKA
CODA ALCONA
IOSCOOGEMAWROSCOMMONUKEEWEXFORMANISTEE
MASON LAKE OSCEOLA CLARE GLADWIN
ARENAC
HURON
MIDLAND
TUSCOLA SANILAC
LAPSHIAWASSEE
GRATIO
AGINAW
GENESEE
MECOSTA
NEWAYGO
OCEANA
OTTAWA
MONTCALM
IONIA CLINTON
EATO
LIVINGSTON
ALLEGAN
VAN BUREN
JACKSON
BERRIEN CAS JOSEPH BRANCH HILLSDALE WEE MONROE
HOUGHTON
ISABELLA
MUSKEGON
KENT
GHAM
KALAMAZOO CALHOUN WASHTENAW WAYNE
OAKLAND
MACOMB
ST. CLAIR
BAY
CRAWF
BARRY
1
SE
KALKA
MIMISSMISSAURD
2
M
GO
OSCORD
3
KENT
4
MIDLAND
OT
SA
5 A SAN
PEER S
6
CLINTON
ON ING
7
ON
LENAW
W
9
WAYNE
10
SS ST. J
KALA
8
1
5
9
3
7
2
6
10
4
8
Upper Peninsula region
Lake Superior Community
Partnership
Northwest region
NWMCOG
Northeast region
NEMCOG
West Michigan region
The Right Place
East Central Michigan region
Saginaw Future
East Michigan region
Flint and Genesee Chamber of Commerce
South Central region
LEAP
Southwest region
Southwest Michigan First
Southeast Michigan region
Ann Arbor SPARK
Detroit Metro region
Detroit Economic Growth Corp
Oakland County PCD
Macomb County PED
Wayne County EDGE
REGIONS
Michigan’s Regional Performance
Michigan is not one economy; rather it is multiple economies identified by common
regional assets. This section illustrates the economic performance of Michigan's
regions over the last five years.
Output
Employment Growth
Unemployment Rate
Labor Force
Per Capita Income
Population
Input
Degrees Conferred
Technical Education
Educational Attainment
Patents Per 100,000 Residents
69. What it is:
Seasonally-adjusted average number of residents
with a private-sector job.
Why it matters:
Higher levels of private employment indicate both
economic strength and prosperity among the
region’s residents.
Employment Growth
What it is:
Average share of labor force that is looking for
work but does not have a job (not seasonally-
adjusted).
Why it matters:
A lower unemployment rate indicates that more
residents seeking employment are able to find it.
Unemployment Rate
67
regional
Bureau of Labor Statistics (Quarterly Census of Employment and Wages)
Bureau of Labor Statistics (Local Area Unemployment Statistics)
2014 Unemployment Rate
2009-14 Employment CAGR
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What it is:
The share of the population age 16 and older, not
including residents who are on active duty or
institutionalized, that is employed or looking for work.
Why it matters:
Members of the working-age population can stop
looking for work and drop out of the labor force due
to many reasons, including disability, old age, or
discouragement. Higher labor force participation is
a sign of a healthier economy and workforce.
Labor Force
Bureau of Labor Statistics (Local Area Unemployment Statistics)
What it is:
Share of residents aged 25 to 64 with an
associates degree or higher.
Why it matters:
The availability of highly educated talent can
promote future growth of the economy.
Educational Attainment
U.S. Census Bureau (American Community Survey)
2009–14 Labor Force CAGR
Educational Attainment (2009–13 Estimates)
71. 69
regional
What it is:
Personal income (2014 dollars) divided by
population. Personal income includes salaries,
wages, and bonuses from employment; dividends
and interest from investments; rental income;
pensions, etc.
Why it matters:
Personal income is an indicator of prosperity and
average standard of living in a region.
Per Capita Income 2013 Per Capita Personal Income
Bureau of Economic Analysis (Personal income summary),
Bureau of Labor Statistics (CPI Inflation Calculator)
2008-13 Per Capita Personal Income CAGR
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What it is:
Number of residents.
Why it matters:
Growth in population is an indicator for how
well a region attracts and maintains residents.
It also affects a region’s ability to support
shared responsibilities such as maintaining
infrastructure.
Population
U.S. Census Bureau (Population Estimates)
2014 Population
2009-14 Population CAGR
73. 71
regional
What it is:
Total associate’s, bachelor’s, master’s, and doctorate
degrees conferred per 10,000 residents by public
and private institutions.
Why it matters:
Educational attainment is a factor in determining
the quality of a region’s talent pool.
Degrees Conferred
National Center for Education Statistics (Integrated Postsecondary
Education Data System), U.S. Census Bureau (Population Estimates)
2014 Degrees Conferred
What it is:
Total critical skills degrees and certificates
conferred divided by the working age population
(ages 20 through 64, inclusive).
Why it matters:
These degrees prepare students for high-skilled
occupations, particularly in the STEM fields,
which are the types of jobs Michigan expects to
increase in the future.
Technical Education
National Center for Education Statistics (Integrated Postsecondary
Education Data System), U.S. Census Bureau (Population Estimates)
2014 Critical Skills Degrees Conferred
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What it is:
Percent of first-year undergraduates from out of state.
Why it matters:
This indicates how well higher education institutions
are attracting students from out-of-state to provide
an infusion of talent and capital. This should be
compared with in-state enrollment to ensure that
regions are maintaining in-state enrollment.
Out-of-State Enrollment
National Center for Education Statistics Integrated Postsecondary Education Data
System, U.S. Census Bureau Population Estimates (2012 data)
What it is:
The percent of a region's population between the
ages of 25 and 34.
Why it matters:
Growth in prime working-age population is an
indicator for how well a region attracts and retains
workers. This affects a region’s ability to grow,
attract businesses, and maintain public
infrastructure and programs.
Population Age 25-34
U.S. Census Bureau (Population Estimates)
2008-2012 Average Annual Enrollment Change
2013 Population Age 25–34
75. 73
regional
What it is:
Number of U.S. patents awarded per 100,000
residents.
Why it matters:
Patents provide an incentive for innovators and
entrepreneurs to improve technology. The regions
whose residents are the source of this innovation
have an advantage in reaping the economic
benefits derived from them.
Patents Per Capita
U.S. Patent and Trademark Office (Patents By Country, State, and Year -
Utility Patents), U.S. Census Bureau (Population Estimates)
2013 Patents Per Capita
What it is:
The number of new, privately owned, housing
units authorized for construction per 1,000
residents.
Why it matters:
This measure indicates how quickly new housing
stock is being created in the region — a proxy for
growing population and household formation,
and a source of economic growth.
New Construction Permits
U.S. Census Bureau
New Construction Permits
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JEFF M.FETTIG
Whirlpool Corporation
CHAIR,BLM BOARD
TERENCE E.ADDERLEY
Kelly Services, Inc.
KEITH J.ALLMAN
Masco Corporation
G.MARKALYEA
Alro Steel Corporation
GERARD M.ANDERSON
DTE Energy
JOSEPH B.ANDERSON,JR.
TAG Holdings, LLC
DAVID W.BARFIELD
The Bartech Group, Inc.
MARY BARRA
General Motors Company
ALBERT M.BERRIZ
McKinley, Inc.
MARK J.BISSELL
BISSELL Inc.
LAURENT BRESSON
Nexteer Automotive
JOHN C.CARTER
Chase
GREGORY J.CRABB
Amerisure Insurance Company
ROBERT S.CUBBIN
Meadowbrook Insurance Group, Inc.
MATTHEW P.CULLEN
Rock Ventures LLC
MARY CULLER
Ford Motor Company
WALTER P.CZARNECKI
Penske Corporation
KURT L.DARROW
La-Z-Boy Incorporated
DAVID C.DAUCH
American Axle & Manufacturing
RICHARD L.DeVORE
PNC Financial Services Group
DOUG DeVOS
Amway
ALESSANDRO P.DiNELLO
Flagstar Bank
STEFAN O.DOERR
BASF Corporation
J.PATRICK DOYLE
Domino’s
JAMES E.DUNLAP
Huntington
MATTHEW B.ELLIOTT
Bank of America
WILLIAM CLAY FORD,JR.
Ford Motor Company
DAN GILBERT
Quicken Loans
DAVID GIRODAT
Fifth Third Bank-Eastern Michigan
DAN GORDON
Gordon Food Service, Inc.
RONALD E.HALL
Bridgewater Interiors, LLC
RICHARD G.HAWORTH
Haworth, Inc.
CHRISTOPHER ILITCH
Ilitch Holdings, Inc.
MICHAEL J.JANDERNOA
Perrigo Company
MILES E.JONES
Dawn Food Products, Inc.
HANS-WERNER KAAS
McKinsey & Company
ALAN JAY KAUFMAN
Kaufman Financial Group
JAMES P.KEANE
Steelcase Inc.
JOHN C.KENNEDY
Autocam Medical
STEPHEN M.KIRCHER
Boyne Resorts
WILLIAM L.KOZYRA
TI Automotive
BLAKE W.KRUEGER
Wolverine World Wide, Inc.
BRIAN K.LARCHE
Engineered Machined Products, Inc.
ANDREW N.LIVERIS
The Dow Chemical Company
KEVIN A.LOBO
Stryker Corporation
DANIEL J.LOEPP
Blue Cross Blue Shield of Michigan
EVAN D.LYALL
Roush Enterprises, Inc.
Business Leaders for Michigan - 2015 Board of Directors
77. BEN C.MAIBACH III
Barton Malow Company
DENNIS MANNION
Palace Sports & Entertainment
RICHARD A.MANOOGIAN
Masco Corporation
FLORINE MARK
The Weight Watchers Group, Inc.
CHARLES G.McCLURE
Michigan Capital Partners, LP
DAVID E.MEADOR
DTE Energy
HANK MEIJER
Meijer, Inc.
MICHAEL MILLER
Google, Inc.
FREDERICK K.MINTURN
MSX International
PAUL J.MUELLER
The Hanover Insurance Group
MARKA.MURRAY
Meijer, Inc.
JAMES B.NICHOLSON
PVS Chemicals, Inc.
WILLIAM U.PARFET
MPI Research
CYNTHIA J.PASKY
Strategic Staffing Solutions
ROGER S.PENSKE
Penske Corporation
WILLIAM F.PICKARD
Global Automotive Alliance, LLC
SANDRA E.PIERCE
FirstMerit Michigan
CHARLES H.PODOWSKI
The Auto Club Group
JOHN RAKOLTA,JR.
Walbridge
MICHAELT.RITCHIE
Comerica Bank
DOUG ROTHWELL
Business Leaders for Michigan
ANDRA M.RUSH
Rush Group Family of Companies
JOHN G.RUSSELL
CMS Energy & Consumers Energy
MARK S.SCHLISSEL
University of Michigan
J.DONALD SHEETS
Dow Corning Corporation
GARYA.SHIFFMAN
Sun Communities, Inc.
LOU ANNA K.SIMON
Michigan State University
SAM SIMON
Simon Holdings
MATTHEW J.SIMONCINI
Lear Corporation
BRIG SORBER
Two Men And A Truck/International, Inc.
ROBERT S.TAUBMAN
Taubman Centers, Inc.
GARY TORGOW
Talmer Bancorp, Inc.
HOWARD UNGERLEIDER
The Dow Chemical Company
SAMUELVALENTI III
TriMas Corporation
STEPHEN A.VAN ANDEL
Amway
BRIAN C.WALKER
Herman Miller, Inc.
THOMAS J.WEBB
CMS Energy & Consumers Energy
THOMAS G.WELCH,JR.
Fifth Third Bank-Western Michigan
GILWEST
Delta Air Lines, Inc.
M.ROY WILSON
Wayne State University
ROGER J.WOOD
Dana Holding Corporation
WILLIAM C.YOUNG
Plastipak Holdings, Inc.
MARK ZEFFIRO
Horizon Global
This list represents the board
members at the time of printing.
For a current list, visit
businessleadersformichigan.com
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