Michigans prosperity slips with education findings

October 17, 2011
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On the heels of Gov. Rick Snyder’s continued appeal in Grand Rapids last week for policies that streamline immigration processes to recruit and engage foreign entrepreneurs, Michigan Future Inc. will release its new report on Michigan’s progress toward a knowledge-based economy — or lack of progress.

Snyder has reiterated this year the importance of new businesses and private-sector job creation by companies and individuals around this “flat” world, even noting such companies as Meijer and Dow Chemical as examples of such success. His recent trip to Asian countries underscored the possibility of new partnerships in that regard, but Snyder also emphasized his belief that retaining international students after graduation from Michigan colleges and universities is vital.

His emphasis is underscored in the Michigan Future report, which, since 1990, has provided analysis of the relationship between the education level necessary for knowledge economy jobs and direct impact on job growth and personal income levels.

Michigan Future President Lou Glazer conducted the study with the senior research specialist at the Institute for Research on Labor, Employment and the Economy at the University of Michigan, Donald Grimes. Glazer and Grimes report that Michigan and its largest metropolitan areas are lagging in the transition to a knowledge-based economy.

In 2009, Michigan ranked 37th in per capita income, an unprecedented drop of 19 places in a relatively short nine-year period but in line with its position as 36th in college attainment. Michigan ranked 30th in the share of wages from knowledge-based industries. Metro Detroit ranked 41st in per capita income among 55 metro areas with populations of 1 million or more, and metro Grand Rapids ranked behind the Motor City, at 54th in per capita income and 44th in college attainment, slightly ahead of Detroit, which ranked 39 in college attainment.

“What we found is stunning. The trends we have written about in past reports have accelerated,” said Glazer. “It’s even more apparent now than before: What made Michigan prosperous in the past is no longer our path to prosperity. We will not prosper by chasing low education jobs. This is an inescapable truth.”

The report shows that the “contrasting fortune of high education attainment versus low education attainment sectors is part of a two-decade-long trend.” Glazer points out that since 1990, high education attainment industries have experienced job growth of 36 percent compared to 7 percent in the rest of the economy. The report further establishes that 34 percent of Michigan’s personal income comes from government revenue, an especially troubling finding.

Snyder must also pay heed to the study and create a state of learning, emphasized by public policy and funding. College and university presidents across the state are providing Michigan’s best solution to becoming economically prosperous.

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