Michigan - Economy

Economy

The Bureau of Economic Analysis estimated Michigan's 2010 gross state product at $384.1 B. In May 2012, the state's unemployment rate was 9.1%.

Products and services include automobiles, food products, information technology, aerospace, military equipment, furniture, and mining of copper and iron ore. Michigan is the third leading grower of Christmas trees with 60,520 acres (245 km2) of land dedicated to Christmas tree farming. The beverage Vernors was invented in Michigan in 1866, sharing the title of oldest soft drink with Hires Root Beer. Faygo was founded in Detroit on November 4, 1907. Two of the top four pizza chains were founded in Michigan and are headquartered there: Domino's Pizza by Tom Monaghan and Little Caesars Pizza by Mike Ilitch.

Since 2009, GM, Ford, and Chrysler have managed a significant reorganization of their benefit funds structure after a volatile stock market which followed the September 11 attacks and early 2000s recession impacted their respective U.S. pension and benefit funds (OPEB). General Motors, Ford, and Chrysler reached agreements with the United Auto Workers Union to transfer the liabilities for their respective health care and benefit funds to a 501(c)(9) Voluntary Employee Beneficiary Association (VEBA). Manufacturing in the state grew 6.6% from 2001 to 2006, but the high speculative price of oil became a factor for the U.S. auto industry during the economic crisis of 2008 impacting industry revenues. In 2009, GM and Chrysler emerged from Chapter 11 restructurings with financing provided in part by the U.S. and Canandian governments. GM began its initial public offering (IPO) of stock in 2010. For 2010, the Big Three domestic automakers have reported significant profits indicating the beginning of rebound.

Michigan ranks fourth in the U.S. in high tech employment with 568,000 high tech workers, which includes 70,000 in the automotive industry. Michigan typically ranks third or fourth in overall Research & development (R&D) expenditures in the United States. Its research and development, which includes automotive, comprises a higher percentage of the state's overall gross domestic product than for any other U.S. state. The state is an important source of engineering job opportunities. The domestic auto industry accounts directly and indirectly for one of every ten jobs in the U.S.

Michigan was second in the U.S. in 2004 for new corporate facilities and expansions. From 1997 to 2004, Michigan was the only state to top the 10,000 mark for the number of major new developments; however, the effects of the late 2000s recession have slowed the state's economy. In 2008, Michigan placed third in a site selection survey among the states for luring new business which measured capital investment and new job creation per one million population. In August 2009, Michigan and Detroit's auto industry received $1.36 B in grants from the U.S. Department of Energy for the manufacture of electric vehicle technologies which is expected to generate 6,800 immediate jobs and employ 40,000 in the state by 2020. From 2007 to 2009, Michigan ranked 3rd in the U.S. for new corporate facilities and expansions.

As leading research institutions, the University of Michigan, Michigan State University,and Wayne State University are important partners in the state's economy and the state's University Research Corridor. Michigan's public universities attract more than $1.5 B in research and development grants each year. The National Superconducting Cyclotron Laboratory is located at Michigan State University. Michigan's workforce is well-educated and highly skilled, making it attractive to companies. It has the third highest number of engineering graduates nationally.

Detroit Metropolitan Airport is one of the nation's most recently expanded and modernized airports with six major runways, and large aircraft maintenance facilities capable of servicing and repairing a Boeing 747 and is a major hub for Delta Air Lines. Michigan's schools and colleges rank among the nation's best. The state has maintained its early commitment to public education. The state's infrastructure gives it a competitive edge; Michigan has 38 deep water ports. In 2007, Bank of America announced that it would commit $25 billion to community development in Michigan following its acquisition of LaSalle Bank in Troy.

Michigan led the nation in job creation improvement in 2010.