The University of Michigan’s annual economic forecast for Oakland County shows that Michigan’s richest big county is bouncing back and then some from the pandemic’s recession.
The county is poised to surpass pre-pandemic employment levels late this year, a good omen for all of southeast Michigan — because Oakland’s typically strong economy is an engine that drives much of the regional economy, according to a team of U-M economists.
The economic experts said they were cheered by Oakland County’s last 12 months of dramatically dropping jobless rates and rising wages. Still, they warned that national and global factors, such as inflation and the war in Ukraine, still pose economic risks that could set back households throughout the county and Michigan as a whole.
The annual presentation was unveiled Thursday morning at the M1 Concourse conference center, amid an 87-acre complex of more than 250 condominium garages that house costly sports and collector cars, built on the reclaimed site of the former GM truck and bus assembly plant.
Among the experts’ findings that apply across all of southeast Michigan, researchers checked the status of regional computer-and-math-related jobs throughout metro Detroit. The demand for workers who can fill such jobs is growing rapidly, nationwide. It represents the United States’ answer to vigorous competition in advancing technology by equivalent workers in China, India, and other global competitors.
U-M’s researchers found that metro Detroit has a slightly higher share of these computer-and-math-related jobs than the nation as a whole, but they also found something they say is worrisome for local employers and economic development directors: the median wage for those occupations in southeast Michigan is well below the national average, even after adjusting for differences in the cost of living between metro Detroit and, for example, the Silicon Valley area of California.
In order for metro Detroit “to remain the research brain” of an increasingly computerized
automotive industry, the U-M economists say, employers here will need to raise wages for that key sector of employment.
The U-M researchers forecast a stronger Oakland County recovery from the pandemic’s recession than they predicted for neighboring Macomb, Wayne, and other counties. Here’s why:
- Oakland County has a large private sector of employment and relatively less employment in government jobs, notable because the private sector is growing faster than government employment;
- Oakland has a tighter labor market than neighboring counties, meaning there aren’t as many workers to fill available jobs, which “helps to ensure that Oakland’s prosperity is shared with workers in the lower-wage industries”;
- And Oakland County government made an especially strong effort to provide relief grants, loans, and other assistance to keep small businesses afloat during the pandemic’s downturn. Oakland ranked first among Michigan counties “on nearly every metric in the Paycheck Protection Program, including total funds, funds per resident, local jobs supported, and total loan forgiveness,” according to a news release tied to the economic forecast.
The economists predicted that the county’s average real wages would grow at least through 2024. By year-end, they expect the county’s employers will be paying an average wage of $71,700 in 2021 dollars, or about 7% above the pre-pandemic level from 2019. Of course, that’s an average — meaning that some incomes in Oakland County may be in the hundreds of thousands of dollar a year while residents in pockets of poverty such as Pontiac earn far less than the average.
Oakland County’s robust recovery from the pandemic’s downturn highlights its long-standing strengths as a center of high-tech employment, “including its educated
workforce and focus on 21st-century manufacturing and engineering,” said U-M economist Gabriel Ehrlich, director of the U-M Research Seminar in Quantitative Economics, which receives a fee from Oakland County government to provide the annual forecast.
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Blue-collar industries are expected to be among the quickest to fully recover from the pandemic period, Ehrlich said in the forecast’s 23-page report.
Presenting the forecast along with Ehrlich was economist Donald Grimes, a specialist in labor economic and a senior researcher with the seminar group — a team of economists who present U-M’s Annual Economic Outlook Conference, billed as the longest running such event in the nation.
Contact blaitner @freepress.com