News Story

Checking the Numbers on Michigan's Auto Jobs

When GOP presidential candidate Mitt Romney came to Michigan and said he was opposed to the auto bailout, the Associated Press reported: “GM and Chrysler are again making money and adding thousands of jobs in Michigan, which continues to struggle with an 11.1 percent unemployment rate, the nation's third highest.”

But have GM and Chrysler really added thousands of jobs in Michigan? That could be a stretch, according to the U.S. Bureau of Labor Statistics.

From September 2010 through September 2011, Michigan added a net 65,300 jobs, according to the most recent BLS figures.

“That’s a very positive sign about the state’s economy,” said James Hohman, assistant director of fiscal policy at the Mackinac Center for Public Policy.

But just 1,000 of those 65,300 jobs were from the “transportation equipment” sector, which includes the state’s core blue collar jobs that are tied to the auto industry.

The state’s largest sectors providing job gains are private-sector education and health care services, which saw an additional 25,200 jobs, and professional business services, which added 19,000 jobs.

The auto industry, Hohman said, is only responsible for a small part of the state’s most recent job growth.

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.

News Story

How Much of Michigan's Troubles Can Be Blamed on the Auto Industry?

With the GOP presidential candidate debate held Wednesday night in Michigan, the state’s economic woes received national attention from an Associated Press story that pinned the malaise on the auto industry.

“But Michigan's economy is still bad, a victim of the auto industry's long slide,” the AP story reported as it was picked up all across the country.

Blaming the auto industry for the brunt of Michigan’s problems is not uncommon.

Former Gov. Jennifer Granholm used the auto industry as a reason why the state languished during her eight-year run.

But James Hohman, assistant director of fiscal policy at the Mackinac Center for Public Policy, said that’s not a fair assessment of what went on in Michigan under Gov. Granholm.

“It’s fingering the blame for all of Michigan’s economic problems on one specific industry,” Hohman said. “All of Michigan’s industries have been doing poorly.”

The U.S. Bureau of Labor statistics tracks jobs in 11 major industrial categories, such as manufacturing, construction and government.

Michigan had a net loss of jobs in 10 of those 11 categories from April 2000 to September 2011. The only growth was in the “education and health” category.

The auto industry and related transportation equipment manufacturers accounted for only 23 percent of the 908,300 total jobs lost in those 10 major industrial categories that reported net job losses over the past 11 years.

“The former governor’s point that she was not exclusively responsible for Michigan’s economic problems is correct,” Hohman said. “Conversely, her analysis that it was all the auto industry’s fault is false. … What she can be blamed for is responding to broad economic problems with policies designed to help only those she favored. In addition to those ineffective and harmful responses, she made other bad moves for the state economy. She presided over a vast increase in licensing and regulation, not to mention her increases in business and income taxes.”

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.

Commentary

Whoville Speaks Out

The Obama administration decided the federal government should be in the Christmas tree business as reported on The Foundry.org. Every fresh Christmas tree in the nation would be taxed 15 cents in order to fund a Christmas Tree Promotion Board.

Federal officials claim that the charge is not a tax and would not yield revenue to the federal government. Regardless of the validity of the nontax claim, the image of the Christmas tree does not seem to be endangered or require a federal bailout. 

It is clear that many officials in the federal government do not have the faintest clue of what constitutes a proper limited role of government as envisioned by the Founding Fathers. It seems we could help reduce the federal deficit by eliminating entire programs and even departments in Washington, D.C. If federal officials do not have anything better to do than market Christmas trees, taxpayers don’t need to fund their salaries.

There is some Christmas cheer, however. Once the story broke, it caused so much consternation that the Obama administration decided to reconsider. The American people have apparently stopped, or at least slowed down, the Christmas tree Grinch.

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.