Michigan has lost half of its auto jobs since the turn of the century. But it hasn’t lost nearly half of its total jobs. This is because the state-owned economy is more complicated than its reputation.
Auto manufacturing is not a very good job growth industry. Michigan’s share of a shrinking market is declining. The state’s share of the auto industry fell, as did its total number of auto jobs. In 1990, Michigan was home to 27 percent of the nation’s auto and auto parts manufacturing jobs. Today, that percentage is 18%. Michigan’s peak in the number of auto jobs didn’t come during the mythical postwar golden age some old-timers might think. The peak occurred in 2000.
The total number of auto jobs in the United States also peaked in 2000. Employment trends in Michigan are slightly worse than nationally, but national and state employment trends are closely related. Those jobs didn’t move to other states; the numbers went up and down together.
Michigan remains the heaviest auto-making state. The state produces $30.8 billion in automotive equipment. The next state is Indiana at $16.6 billion. The entire auto industry is producing more but employing fewer workers.
So, where are all the jobs in Michigan?
Even outside the auto industry, Michigan remains a manufacturing powerhouse. Combined, these other industries account for a larger share of the state’s job market. There are 2.5 times as many manufacturing jobs outside the auto and auto parts production industries. These include 31,000 jobs in chemical manufacturing, 10,000 jobs in wood product manufacturing and 38,000 jobs in food manufacturing.For example, Grey Poupon from Heinz Factory Holland in Michigan.
The sector that employs the most people isn’t even manufacturing. This is a large professional and business services category that covers a lot. The industry includes engineering firms, lawyers, accountants and advertisers. Another 72,000 people work in corporate headquarters operations and in any other department included in Corporate and Business Administration. About 53,000 doormen and others work in a category labeled “Building and Residential Services.”
More people are now working in healthcare. The health sector employs 577,100 people, and jobs in these sectors have grown steadily over time—a 29 percent increase since 2000.
In Michigan, more people work in banks and other financial institutions than in the manufacture of automobiles and auto parts. Since 2000, jobs in the industry have increased by 13%.
That’s just employment. Production value—all the goods sold and services provided by the people of the state—suggests Michigan does more than just make vehicles and parts. The financial sector produces 2.5 times as many workers as the auto manufacturing sector. It’s no surprise to see the healthcare industry make more products as well.
People look for shortcuts to understand what drives a country’s economy. Washington, D.C. is the government. New York is all about finance. California is a movie. Nevada is gambling. Michigan’s idea of navigating the fortunes of its domestic auto industry is a simple shorthand. Except it doesn’t explain much. Again: the state has half of the auto jobs in 2000, but it doesn’t have half of the jobs.
What replaces lost car jobs? Lots of different things.Michigan is home to millions, and if the Great Lakes were its own state, its production would make it 34th in the world largest country. One should not expect an easy answer.
The automotive industry is very important. Many rely on it, and Michigan continues to lead the 50 states in auto manufacturing. Still, we should realize that our country builds more than cars and trucks.
Policies are determined by what people think.Lawmakers give billions to private companies as people get confused headline News and economic data. The auto industry is prioritized in national policy because enough people believe it drives the nation’s prosperity. If we change this understanding, policy will follow. So give some credit to everything else in the state.
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