Economic Development and Travel & Tourism

Mobility tops list of BLM’s priorities

Report identifies state’s automotive legacy as a building block for prosperity.

February 12, 2016
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This year’s roadmap to building a successful state shifts into gear as it looks to growth and stability and opportunities as a potential leading mobility state.

Business Leaders for Michigan, a nonprofit executive leadership organization, announced last week its new agenda for 2016 to support continued growth to help Michigan become a Top 10 economic competitor by 2020 in terms of jobs, personal income and robust economy.

The new report, Building a New Michigan, is intended to add to the priorities and goals laid out in the Michigan Turnaround Plan — BLM’s plan to restart economic growth after the 2008 recession.

The 2016 economic and policy agenda outlines four priorities: strengthening the state’s fiscal stability and reducing future financial uncertainty; increasing the number of workers with education and training beyond high school; growing a “New Michigan” economy by leveraging assets with the greatest potential to meet future global economic needs; and providing stronger economic development services than competing states.

Patrick Doyle, president and CEO of Domino’s and board chair of BLM, said while the state’s economic growth has been promising, there is more work that needs to be accomplished.

“The Great Recession hit Michigan harder than any other state, so while our recent growth has been impressive, we’re still not where we should be in absolute terms,” said Doyle.

“The Turnaround Plan headed us in the right direction. The new plan is designed to complete the mission of getting us to become a Top 10 state.”

Although Michigan’s employment, per capita personal income and per capita Gross Domestic Product rankings fared well in terms of growth between 2013 and 2014, its current ranking still places the state well behind its goal. Michigan was ranked No. 18 in terms of employment growth, 10th for per capita personal income, and third in terms of per capita GDP based on growth; its current standing is Nos. 29, 33 and 34, respectively, according to the report.

If Michigan were performing among the top 10 states in the nation, there would be 120,000 more people in the workforce, and nearly $11,000 in additional annual income and $13,000 more GDP per person, according to the report.

Doug Rothwell, CEO of BLM, said one of the greatest challenges to the state’s continued progress is complacency.

“It is human nature when you are not in a crisis, you don’t tend to focus as much, especially when what we went through in Michigan feels a lot better today than it did five years ago,” said Rothwell. “We are up against world competitors and if we are not a top 10 state, we are not ever going to see our incomes go up. The most important way to get at that is, for yourself, to always want to do better — thus more education or training, and as a state, for us to not be satisfied with being 25.”

In terms of leveraging existing assets, one of the key strategies is to establish Michigan as a global center of mobility by tapping into its automotive industry legacy and future opportunities. Rothwell said there will be “a lot of tangible progress this year” in terms of mobility.

Kelly Chesney, vice president of marketing and communications at BLM, indicated the organization has a goal to host a conference later this year convening thought leaders from across the globe to look at mobility issues as a whole. BLM is working with the Detroit Regional Chamber, MICHauto and the Michigan Economic Development Corp. to develop the conference.

“There is a growing urgency to reduce crashes, relieve the congestion of urban centers, to cut back on carbon emissions and pollution, to conserve resources, and to maximize transportation accessibility to growing populations,” said Chesney.

“To date, there has been little work on how to integrate the technical, economic, social and policy considerations to create a viable mobility ‘system’ that meets the dynamic needs of a changing society,” he said.

The state is also expected to acquire the Willow Run site on former GM property in Van Buren Charter Township to invest in a mobility center for developing connected and autonomous vehicles. Rothwell indicated BLM is working with the local economic development organization, the University of Michigan, MEDC and Michigan Department of Transportation on the project.

“Willow Run should come under state ownership this year. An organization will be set up to run that facility, and the state will start to invest substantial money — it costs about $80 million to build this facility,” said Rothwell.

At the regional level, the Grand Rapids Area Chamber of Commerce recently held a Transportation and Mobility Summit convening a panel of speakers to highlight emerging trends, opportunities and challenges in transportation, logistics and technology.

Josh Lunger, director of government affairs at GRACC, said the organization is excited to move past “how do we fix our roads” and focus on how to better connect the region and industries to the rest of the world.

“We are going to be really seeing some massive kind of transformation changes in how we move things and people in the next 15 years,” said Lunger. “How do we have world-class infrastructure, rail, airports, the port out in Muskegon, and how do we use all of our resources to better connect to the world?”

Lunger said the issue of mobility is important to stay competitive and attract businesses to the region, and while Michigan has been the automotive state for decades, nothing is guaranteed moving forward.

“It is how do we position ourselves in talent and, I guess, futuristic thinking to make sure we maintain and grow our ability to be that automotive state,” said Lunger.

Other efforts outlined in BLM’s agenda are: working toward having a 10-year state strategic plan adopted that requires annual performance-based budgeting; continuing to pay down state unfunded liabilities; and growing the Budget Stabilization Fund to 5 percent of annual operating revenues.

“Basically, it is making sure we don’t have excessive long-term liabilities that risk our need to increase taxes unexpectedly in the future, or that would require us to radically cut services to people,” said Rothwell.

Rothwell said capping the amount of debt a local government can incur and utilizing service-sharing more widely are additional possibilities the state could look into “to make it easier” for Michigan to have better services.

BLM also proposes a unified, statewide economic development strategy to provide continuity and consistency when attracting and retaining businesses to the state.

Other key efforts in education and training are increasing out-of-state enrollment, creating an informational portal for parents and students to learn more about specific interest areas and career opportunities, and launching an awareness campaign for the importance of obtaining an education beyond high school.

“We find from polling information, there is not enough emphasis placed on the need for children to get more than a high school education, and we want parents to encourage their kids, even if they are not college bound, to get an apprenticeship or certificate,” said Chesney. “There is more than one door.”

Rothwell said while income levels have remained relatively flat, the best way to increase income is through education.

“It is not going to be a guarantee that everybody who gets a four-year degree is automatically going to make more, but the data is overwhelming that you are in the best position to make higher incomes if you are more educated.”

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