www.michiganfuture.org
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Our goal
A high prosperity
Michigan
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What state do we want to emulate?
State Per capita Unemployment Poverty Education
income (09) (10) rate (09) attainment (09)
Oklahoma $35,837 7.1 % 16.2 % 22.73 %
Minnesota $41,854 7.3 % 11.0 % 31.50 %
Michigan $34,315 12.5% 16.2 % 24.59 %
U.S. $39,635 9.6 % 14.3 % 27.90 %
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10 Most Prosperous States
Connecticut New York
New Jersey Virginia
Massachusetts Alaska
Wyoming Washington
Maryland New Hampshire
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Looking at “income” more closely
• Components of Per Capita Income
– Private Earnings
– Government Earnings
– Dividends, Interest, Rent
– Transfer Payments
– Social Insurance Taxes & Resident
Adjustments
• Goal is to be high in Private Earnings
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Breaking down income
Natural Other Dividends, Soc. Ins. Tax
Personal Private Resources Private Gov't Interest, Transfer & Residence
Income Earnings Earnings Earnings Earnings Rent Payments Adjustment
U.S. $39,635 $23,427 $669 $22,758 $5,233 $7,143 $6,984 ‐$3,153
Indiana $34,022 $20,555 $467 $20,089 $3,800 $4,968 $6,831 ‐$2,133
Michigan $34,315 $19,785 $240 $19,545 $4,060 $5,499 $7,737 ‐$2,766
Minnesota $41,854 $26,668 $639 $26,029 $4,658 $7,614 $6,891 ‐$3,977
Key numbers in our analysis
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Best states in private income
Non-Nat
Resources Govt. Earnings &
Top 10 Earning Share of PI Transfers Share of PI
Connecticut $33,070 59.8% 24.9%
Massachusetts $32,957 66.4% 25.6%
New York $29,479 63.4% 31.2%
New Jersey $28,554 57.1% 26.1%
Minnesota $26,029 62.2% 27.6%
Delaware $25,792 65.1% 31.8%
Illinois $25,789 61.6% 26.8%
New Hampshire $25,546 59.9% 24.3%
Colorado $25,515 60.9% 25.8%
California $24,795 58.5% 28.3%
United States $22,758 57.4% 30.8%
Michigan $19,545 57.0% 34.3%
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Worst states in private income
Non-Nat
Resources Gov Earnings &
Bottom 10 Earning Share of PI Transfers Share of PI
Oklahoma $17,114 47.8% 35.9%
Alabama $17,094 51.2% 38.1%
Kentucky $17,092 53.0% 39.9%
Montana $16,663 47.8% 35.4%
South Carolina $16,599 51.1% 38.6%
Idaho $16,397 51.5% 32.3%
Arkansas $16,308 50.5% 37.6%
New Mexico $15,367 46.2% 41.2%
West Virginia $14,450 45.0% 42.6%
Mississippi $14,012 46.1% 42.3%
United States $22,758 57.4% 30.8%
Michigan $19,545 57.0% 34.3%
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Traits of prosperous states
• High proportion of wages from knowledge
industries
• High proportion of college grads
• Big metro with higher per cap income than state
• Largest city in that metro has high proportion of
college grads
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What is the knowledge economy?
public goods
5% information
leisure other administration 5%
services 10%
trade trans
3% utilities
7%
financial
activities
health 11%
21%
prof and
business
education services
21% 17%
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Michigan’s income rank aligned
with our college attainment rank
Per Cap Income % 4 year degree
10
15
18
20
34
25
36
30 37
35
2000 2009
40
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10 Most Prosperous Regions
• San Jose/San Fran. • Seattle
• Washington/Balt. • Houston
• NY/Newark • San Diego
• Hartford • Denver/Boulder
• Boston/Worchester • Philadelphia
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Major metros smarter
Education attainment by metro population
35% 33%
30%
30%
25% 26%
25% 24%
23%
20%
15%
10%
Under .2 m .2-.5 m .5-1 m 1-1.6 m 1.6-3.5 m 3.5 m and
up
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Major metros richer
Per capita income by metro population
$50,000
$45,667
$45,000
$39,490
$40,000 $37,470
$35,304 $35,734
$35,000 $33,304
$30,000
$25,000
$20,000
under .2 m .2-.5 m .5-1 m 1-1.6 m 1.6-3.5 m 3.5 m and
up
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Big metros winners in private earnings
Number of Private Earnings Gov Earn &
Size of community communities Per Capita Transfers Per Cap
3.0 million or more 17 $28,767 $11,712
1.0 million to 3.0
million 38 $22,684 $11,931
500,000 to 1.0 million 45 $19,577 $12,250
200,000 to 500,000 88 $18,800 $13,055
under 200,000 122 $17,203 $13,586
Resources are flowing from largest metros
to smaller communities
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Metro Detroit vs.
Metro Minneapolis
City Per cap Education Share of wages from
income attainment knowledge industry
Minneapolis 11 7 13
Detroit 41 39 31
2009 Rank among 55 metros 1 million
population or more
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Metro Grand Rapids vs.
Metro Minneapolis
City Per cap Education Share of wages from
income attainment knowledge industry
Minneapolis 11 7 13
Grand 54 44 54
Rapids
2009 Rank among 55 metros 1 million
population or more
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Metro Lansing vs. Metro Madison
City Per cap % bachelors Share of wages from
income degree or more knowledge industries
Madison $ 42,456 38.90 % 63.61 %
Lansing $ 33,273 29.09 % 65.33 %
2009 data
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High education industries
growing in U.S.
5.83%
6.00%
Employment change 2001-09
4.00%
2.00% $45,558 $59,926
0.00%
-2.00%
-0.79% All industry
-4.00% Low education
$33,383
-6.00%
High education
-5.79%
(2009 average wage)
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High education industries
doing best in Michigan
0.00%
Employment change 2001-09
$54,964
-5.00%
-4.97%
-10.00%
$43,645
-15.00% All industry
-15.66%
Low education
-20.00% $34,646
High education
-22.59%
-25.00%
(2009 average wage)
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Index value (100 in Dec. 2007)
100
105
80
85
90
95
75
2007.12
2008.01
2008.02
2008.03
2008.04
2008.05
2008.06
2008.07
2008.08
2008.09
2008.1
2008.11
U.S. High Ed
2008.12
2009.01
2009.02
2009.03
2009.04
2009.05
U.S. Low Ed
2009.06
2009.07
2009.08
2009.09
2009.1
2009.11
Date Mich High Ed 2009.12
2010.01
2010.02
2010.03
2010.04
2010.05
2010.06
2010.07
Mich Low Ed
2010.08
2010.09
Employment in High and Low Education Attainment
2010.1
Industries, Michigan and the U.S., 2007.12 to 2011.05
2010.11
2010.12
2011.01
2011.02
Recession accelerates trends
2011.03
2011.04
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2011.05

Our conclusion:
The places with the greatest
concentration of talent win!
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Young talent is
aggregating in
urban regions
Younger college grads
Blue = With children
Red = Without children

Our recommendations
•Align Michigan culture with the flat world realities
•Create places where talent wants to live
•Ensure success of vibrant higher ed system
•Reinvent K-12 education to align with new realities
•Develop new public and – more importantly –
private sector leaders
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Bottom line
We must get younger
and better educated
or
we will get poorer
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For more information about Michigan
Future, our reports or what the media is
saying, please visit our Web site at:
www.MichiganFuture.org
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