Michigan Among the Leaders In Job Growth
Recent article, column paint misleading picture about state's economy
Two local writers are portraying Michigan's economy as bleak, with one saying the "check engine light is flashing" and the other predicting "a Scrooge-like" economy for the state.
However, their claims warrant a closer look considering Michigan has been in the top five states in the nation in job growth since the Great Recession ended five years ago, according to numbers from the Bureau of Labor Statistics.
Rick Haglund, whose column appeared on MLive and who also is a regular contributor to the Center for Michigan's online magazine, Bridge, talked about Michigan's U-6 unemployment rate being at 15.8 percent as of Sept. 30. The U-6 unemployment rate includes mostly the number of people unemployed as well as those who are employed part-time but would like full-time work.
Haglund acknowledged the job growth that's occurred in the state in recent years, but added, "a couple of recent reports show that Michigan's economy is running a little rough and the 'check engine' light is flashing on the dashboard."
However, what the column didn't mention is that the U-6 unemployment rate has dropped steadily since 2009, going from 21.5 percent in 2009 to 21 percent in 2010, 18.8 percent in 2011 and 16.6 percent in 2012.
"It's changes in the rate that matters," said James Hohman, assistant director of fiscal policy at the Mackinac Center for Public Policy. "Michigan's current business expansion was the first increase in jobs the state's seen since 2000. You can see this improvement even in the U-6 measure."
In an email, Haglund said he was pointing out information that the governor's office wasn't reporting.
"I will say that I have acknowledged on many occasions that Michigan's economy is much improved since 2009," Haglund said. "But there's a lot of data showing the state's economy isn't as healthy as the press releases coming from the governor's office would have us believe."
Ron French, a senior writer for Bridge, wrote in an article that: "Michigan has a bigger hole to climb out of than most states. It lost a higher percentage of jobs in the past decade than any other state. Even with jobs now growing in the state, Michigan likely will still have fewer in 2023 (4,591,000) than it did in 2003 (4,614,000). If growth is indeed that slow, it will do little to attack Michigan's unemployment rate of 9 percent, which is third-highest in the nation."
French based his conclusion on job projections, which Hohman said are "notoriously unreliable." French would not comment on the job projections.
A group cited in the piece by French, the Research Seminar on Quantitative Economics at the University of Michigan, projected in 2002 that Michigan would be increasing employment in 2003 and "cruising" in 2004 (the state lost about 100,000 jobs over that period). When that did not happen, in 2004, the group projected "solid" job gains in 2005 (the state lost nearly 10,000 jobs). In 2005, the group said the economy was "clearly gaining ground," predicting a gain of about 75,000 jobs (Michigan lost 63,300).
But real data from the last five years shows Michigan is among the top in the country in job growth.
Since the end of the recession in June 2009 to November 2013, Michigan's 6.7 percent job growth (an additional 256,000 jobs) has only been surpassed by North Dakota (24 percent), Texas (9.6 percent), Utah (8.9 percent) and Indiana (7.6 percent). That's payroll jobs data from the U.S. Bureau of Labor Statistics.
Michigan has also done better than neighbors Illinois (3.5 percent) and Ohio (2.9 percent).
French said in an email that the jobs numbers in his story were accurate but he would not comment further.
(Editor's note: This story has been slightly edited since its original posting.)
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.
The World Is Getting Better and Better
Poverty rate slashed 80 percent since 1970
There often is a tendency for those concerned about the size and scope of government to feel like everything is getting perpetually worse. But a full look at the evidence shows this isn't so.
While critics claim that free trade and globalization are merely a "race to the bottom," the world as a whole has been quietly reducing poverty, disease, famines and war by embracing the free market.
University of Michigan-Flint economist Mark Perry has a chart showing the remarkable decrease in the world poverty rate, which has fallen 80 percent, from 26.8 percent in 1970 to 5.4 percent in 2006.
Much of this is the result of formerly Communist and Socialist economies becoming more market based. China, India and most of South America have been embracing capitalism for decades, while Africa also is moving toward freer markets in more recent years, according to the "Economic Freedom of the World" reports.
The most noteworthy country is China. In the early 1980s, the country began moving away from its strict model of economic central planning and began freeing up its markets. From 1981 until 2010, the country pulled over 600 million people out of extreme poverty, at a time when the population increased by 330 million citizens. That's an average of 1.7 million people every month, or, as a comparison, like a population the size of Idaho moving up into the middle-class every month.
By their nature, think tanks are supposed to see beyond the momentary political battles that dominate news headlines every day and focus on the big picture. That's why the Mackinac Center for Public Policy advocated for a right-to-work law for more than 20 years — at a time when the idea was ridiculed across the political spectrum. The dynamism of the world economy is evidence enough of the importance of long-term thinking.
And it is important for those of us wishing for a more limited state to be ever vigilant, because more freedom leads to a better world.
As Arthur Brooks, president of the American Enterprise Institute, recently said: "I will state, assert and defend the statement that if you love the poor, if you are a good Samaritan, you must stand for the free enterprise system, and you must defend it, not just for ourselves but for people around the world. It is the best anti-poverty measure ever invented."
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.
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