Michigan

Michigan: Long road to recovery

Michigan was the 7^th worst performing state in our 2014 EPI ranking, with the EPI score of 83.8%, or C level. A high unemployment rate and budget deficit along with negative GDP growth contributed to the state’s low EPI score.

Automotive production is by far the largest industry in Michigan and produces more cars and trucks than any other state, as Detroit, Michigan is home to the “Big Three” automakers: Ford, General Motors, and Chrysler. This sector contributed a whopping 10.4% to the state’s total GDP and is responsible for nearly one-quarter of total vehicle production in the US. Advanced manufacturing also heavily contributes to the state’s GDP, as this generally tends to support the auto industry, with metal stamping for cars and power train manufacturing employing tens of thousands, and has more engineers per capita than any other state.  Nearly 5% of Michigan’s private workforce is employed in automobile and part manufacturing.

While Michigan was one of the worst states hit by the 2008 recession, it has been steadily recovering with the rebound of the US auto industry. High unemployment still exists and was 7.1% in 2014, a decrease from 8.5% in the previous year. Regional inflation is moderate at 1.5%. Michigan was still running a high budget deficit at 7.1% in 2014, almost a full percentage point above the national average. GDP growth was negative at 1.3% making 2014 the state’s first recessions since 2009, when GDP growth was -8.3%.