Shrinking Michigan
The struggle to attract and retain workers
By Paul Natinsky
Like many northern, cool weather states, Michigan has lost population in recent census counts. The state has also seen its representation in Congress diminish, losing a seat in the latest census. But the state is not registering the worst outmigration in the nation or region, and its predicted population changes for coming decades paint a mixed picture, leaving open the search for causes and solutions.
Topsy turvy trends
Michigan’s population was estimated at 10,034,113 as of July 1, down 3,400 from 2021’s estimate and 43,200 from 2020’s count of 10,077,325, according to Bridge Michigan. The Great Lakes State was the only state to lose population from 2000 to 2010 but gain from 2010 to 2020, rising above 10 million people, according to the report.
COVID-19 likely drove down the state’s population in the last few years; the virus killed 40,000 people in Michigan since 2020. Deaths outpaced births for 2022 by 12,500. Still, Michigan’s loss ranked 17th nationally, trailing the largest outmigration state, New York, by a wide margin as that state lost 1 percent of its population, or 180,000 people.
Short-term dips are likely to give way to long-term leveling, with Michigan peaking at 10,500,000 in 2050, according to a University of Michigan estimate.
“People have to be cognizant of the fact that there is not one issue that drives this,” said Jim Holcomb, President of the Michigan Chamber of Commerce. “It’s many issues. Michigan can’t just change one thing and fix the problem.”
Political disharmony
Holcomb pointed to Michigan’s unstable political climate as a major barrier to the state improving its living and work environments.
“In Michigan we are very polarized, and we need to move past elections, we need to get past the vitriol, we need to look at civility in our society and in politics and be willing to have real conversations about complex issues that drive passions,” he explained.
Aptly, Holcomb used a metaphor from bowling to characterize the contentious character of the blue-collar state. “You have a gutter on the left and a gutter on the right. Get your ball down the middle, you get some pins and every now and then you get a strike.”
Holcomb also pointed to factors such as income tax, the need for affordable housing and childcare, better roads and bridges, and working with the federal government on strong legal immigration programs.
Educational alternatives
“We need to make sure we are developing future talent if we’re going to stay super competitive as a state and as an industry. One of the things we can do for that is to make sure that we are modeling school districts with the flexibility to provide career exploration for their students,” said David Worthams, Director of Employment Policy at the Michigan Manufacturers Association.
He said middle and high schools need to teach shop, nursing, art, manufacturing, and construction as alternatives to solely providing preparation for a four-year college degree.
“This way kids who don’t want to pursue a four-year degree can come out of high school with skills and enjoy a high quality of life working in the trades. At least on par with those with four-year degrees,” said Worthams.
Economic development programs
With sun belt states such as Florida and Arizona gaining over 1 million in population and cold weather and rust belt states losing a similar number of people, Worthams sees a trend that needs changing.
“You’re seeing it already. You have tons of openings in manufacturing, we have thousands of openings in construction that are going unfilled. And if we don’t address that you’re looking at probably losing close to $2 trillion in economic power in the course of the next 10 to 15 years.
“We have to, in Michigan, create an environment where business feels welcome, where business can compete and that also creates places where people want to live, work and play.”
Many young people are deciding where they want to live before they decide what they want to do for work. “So, if we don’t have those places that attract people, we’re going to continue to lose population.”
Worthams said Michigan needs to embrace new technologies—such as battery manufacture for electric vehicles—to stay competitive with other states. He said the state also needs to sell its attributes, such as four seasons, for those who like to snow ski and water ski.
He added that Michigan needs to step up its economic development game, as Tennessee, North Carolina and South Carolina have. Those states use a combination of tax breaks, tax policy, talent development and talent programming to develop their business environment and workforce.
The local view
Metro Detroit businessman Mike Sarafa has been part of the area’s business community in various ventures for more than 30 years. He is a lawyer by training and a leader in the Chaldean community.
“We’ve been, for a couple of decades, proportionately losing population relative to the rest of the states,” he said. But I think for the first time ever we are numerically going in the wrong direction.”
Sarafa said the reasons are myriad and complicated. They include demographics such as people having fewer children and getting married later. They also include situations created by the COVID pandemic that endure as the virility of the pandemic fades. Workers can work for Michigan-based companies and live elsewhere.
Regardless of what he sees as the reasons for Michigan’s loss of workers, Sarafa has an up-close view of the effects of the shrinking work force on the local economy.
“It’s not just climate and taxes—the things we talked about 20 years ago—we’re pretty competitive among Midwest states. State income tax is not bad.”
He said the re-gentrification of the city of Detroit—with young professionals moving back into the city to live and work—came to a stop with the onset of the pandemic, and never really regained its momentum.
He also said the trend of young people getting drivers licenses later might indicate a desire to live where they can walk to work or take public transportation.
Still, Sarafa said Detroit doesn’t face the high crime rates befalling Chicago and Philadelphia. And Detroit has not been plagued by the police brutality incidents occurring in other cities, making it puzzling why Detroit and Michigan trail comparable regions in population.
Whatever the causes, solutions are likely to be long and complex as the country’s political, social, and economic climate continues to churn.