Politics & Government

Oakland County Recovery 'Not Great', but Happening Slowly

University of Michigan economists predict slow economic growth for Macomb and its surrounding counties, but growth nonetheless.

While Oakland County will not see a miraculous economic turnaround anytime soon, recovery is expected to continue, albeit slowly, over the next two years.

“It’s not great,” said Donald R. Grimes, of the University of Michigan’s Institute for Research on Labor, Employment and the Economy. “We still have some problems to deal with, but we’re going to get employment growth. The recovery will continue.”

Grimes joined fellow economist Dr. George A. Fulton on Tuesday to give a regional economic forecast for the six counties of the Economic Growth Alliance.

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Although Genesee, Lapeer, Livingston, St. Clair, Oakland and Macomb counties will all experience different levels of growth owing to their unique economic situations, the bottom line for the region and the nation is recovery, rather than a relapse into what Grimes and Fulton call “The Great Recession.”

Snapshot of Oakland County

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  • Percentage change in total real wage from 2001-2010 was 1.8 percent.
  • The unemployment rate is expected to drop from 12 percent in 2010 (the second lowest among the six counties) to 10 percent in 2013.

Job gains were modest last year, but Grimes and Fulton predict the region will add more than 50,000 jobs this year through 2013. Some 24,000 jobs have already been added in 2011, but another 13,000 jobs are expected in 2012, with 17,000 more in 2013.

“We are forecasting continued job growth in the region, particularly in the private sector,” Grimes said. “The government sector remains weak. The manufacturing sector has been very strong in 2011 and we expect it to continue to grow. Part of that is driven by the auto industry, which we continue to see expanding, hopefully.”

In the private sector, most job growth will be centered in the service providing sector, such as professional and business services; private education and health services; and trade, transportation and utilities.

  • Professional and business services: More than 22,300 jobs expected in 2010-13
  • Private education and health services: More than 9,000 jobs expected in 2010-13
  • Trade, transportation and utilities: More than 6,8000 jobs expected in 2010-13

While much of this growth is in temporary help, Grimes said gains are being made in the higher wage areas and more permanent positions will be added in time.

These gains are expected to free up more discretionary spending, meaning businesses such as restaurants, hotels, golf courses and entertainment will experience modest growth as well.

And while service-providing industries will account for two-­thirds of the job gains through 2013, the goods-­producing sector will contribute to the other third, with about 18,000 in manufacturing and more than 2,000 in construction. On the manufacturing side, this growth stems primarily on the revitalization of the auto industry.

“We’re fairly optimistic about auto industry,” Fulton said. “Vehicle sales will increase. The debt and cost structure is more under control, so they can make more money at lower sale levels.”

Fulton and Grimes also factor in the positive impact of the re­-opening of the Orion Assembly Plant in Oakland County.

As a result of improved job growth, the unemployment rate in the region is expected to drop from last year’s 12.9 percent to 11.2 percent in 2012 and 10.6 percent by 2013.

"After shrinking for several years, the region's labor force will begin expanding again starting in 2012, as additional job seekers are drawn in by improving job opportunities," Fulton said in a prepared statement. "This keeps the jobless rate from falling as much as it otherwise would with the employment gains we are projecting."

But the bad news continues for those in the government sector as well as repair and maintenance services, film, broadcasting and publishing (which includes the news outlet bringing you this information), as job losses in these areas are expected to continue through 2013. The government sector alone is expected to lose about 7,000 jobs by 2013. 

However, Grimes and Fulton stress their belief that recovery will continue.

"We have a slowdown in the economy, but we are not forecasting a double dip recession," Fulton said. "We are forecasting continued growth both in the national economy and in the regional economy."


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