economy

The Index of Consumer Sentiment has been increasing lately.
U of M

WASHINGTON - A survey finds U.S. consumers are more optimistic about the economy than at any other time in the past eight years, buoyed by more jobs and falling gas prices.

The University of Michigan says its index of consumer sentiment has jumped to 93.6 from 88.8 in November.

Governor Rick Snyder plans to sign an executive order this morning to create a new state department with a focus on improving the state's workforce. It will be called the Department of Talent and Economic Development.

The Michigan Economic Development Corporation will be moved into it. So will the state's unemployment agency. Governor Snyder says developing talent will give Michigan an edge over other states and countries in attracting employers.

A more seamlessly connected experience.

That's what Jeff DeGraff thinks Michigan needs to move its economy forward. DeGraff is our partner for The Next Idea. He's a clinical professor of management and organizations at the U of M Ross School of Business.

DeGraff says he sees Michigan’s economy as three distinct parts: large multinational corporations based in the greater Detroit metro area; mid-level businesses in western Michigan; and small startups in places like Ann Arbor that have young, vibrant, and intelligent people.

Click on the link above to hear Cynthia's conversation with DeGraff.

Time to turn Michigan's "three economies" into one

Dec 1, 2014
Wikimedia

When it comes to economic growth in Michigan, one size does not fit all. Take a look at the varying scope and scale of companies here and you’ll find a general pattern of three different types of businesses associated with different regions:  large multinational corporations in Southeast Michigan, small high-tech start-ups in Ann Arbor, and family-owned, mid-size companies in Western Michigan.

More economists are telling us that income and wealth inequality is growing in the U.S.

The Economist declared that inequality in wealth in America is approaching record levels. They argue that the gap between the haves and the have-nots is getting wider as the rich get richer.

Michigan State University economics professor Charlie Ballard joined us today to talk about this wealth disparity in the U.S.

You can listen to our conversation below.


User: Marvin Shaouni / Urban Innovation Exchange

You might have heard of urban farming in Detroit, but do you know you can grow seafood in Detroit’s vacant homes?

Aside from the Heidelberg Project, do you know metro Detroit also has community art projects like Green Alley, Scarab Club’s art exhibits, and an upcoming Museum of Curiosity?

These are the kind of ideas Urban Innovation Exchange hopes to explore at its first national convention Sept. 24-26 in Detroit.

It's one in a series of citywide events jam-packed into the month of September to showcase small projects that are transforming the city, from Tour de Troit to Dlectricity.

Detroit's first Latina council member, Raquel-Castaneda-Lopez, speaks at a press event earlier this year announcing Michigan’s intention to establish an "EB-5 regional center."
screen shot from LiveStream

It's called the EB-5 program. It's based on the employment-based 5th preference visa program, which allows foreign investors and their families to get their green cards – get permanent residency – by investing in an enterprise that creates at least 10 direct or indirect jobs in Michigan.

Private companies have been using the EB-5 program to bring immigrants into the country, but Michigan has become only the second state – after Vermont – to create a state EB-5 program. It will be staffed by the Michigan State Housing Development Authority.

Scott Woosley is the MSHDA Executive Director.

*Listen to the full show above.

The outlook is better for Michigan teenagers looking for Summer jobs.

But not that much better.

State officials are predicting 242,000 teens will look for summer jobs in Michigan. Most will be successful. But still about 26% are expected to end their Summer vacation without picking up a paycheck.

Jeff Aula is an economic analyst with the state of Michigan. He says it’s important for teen job seekers not to get discouraged.

collage by Mark Brush / Michigan Radio

Last Friday, we asked people to share a photo that represents why they stay in Michigan.

So far, people have shared thousands of photos and tweets using the hashtag #whyIstay.

Public radio stations all over the country are asking their communities the same question. Here's a collection showing all the responses.

UM's Ross School of Business.
UM

Words of encouragement, like “think positive,” can be flung around with little thought when we face challenging situations.

It's something we hear so often that it's easy to tune out.

But there is real power in those words: The power to make our workplaces better and more effective.

This week, The Ross School of Business at the University of Michigan is holding its first-ever Ross Positive Business Conference.

Chris White leads the Center for Positive Organizations at the University of Michigan, and he joined us today.

*Listen to our interview with above.

Gallup

I mean, it's not like we're living in Hawaii, after all.

Michigan is "above the national average" for the number of people who say they'd rather live somewhere else, according to the Gallup poll.

Here was the question they put to the 600 people they reached by phone in Michigan:

"Regardless of whether you will move, if you had the opportunity, would you like to move to another state, or would you rather remain in your current state?"

Twitter

There's no arguing the fact that startups are a key to a thriving economy. Between 1980 to 2005, for example, nearly all net job creation in the U.S. came from companies less than five years old.

But what does that start-up need before it gets up and running, creating jobs, selling products, paying taxes? It needs capital. And getting that initial dose of money can be a tough challenge for a small business.

That's why there's growing excitement over Michigan's new crowdfunding law. It's called the Michigan Invests Locally Exemption – "MILE."

Let's find out what this new law means for Michigan start-ups and for your opportunities to invest in small businesses.

Sandra Cochrane is a consultant with the Michigan Small Business Development Center, and she joined us today.

Listen to the full interview above.

Eight Great Lakes governors and the premiers of Ontario and Québec launched a new initiative with the Paulson Institute today. The Paulson Institute is headed up by former U.S. Treasury Secretary, Henry Paulson.
Fortune Live Media / Flickr

TRAVERSE CITY, Michigan – An organization representing the eight states and two Canadian provinces in the Great Lakes region is teaming with former U.S. Treasury Secretary Henry Paulson in an effort to attract foreign manufacturing investment.

The Council of Great Lakes Governors announced the initiative Friday during a meeting in Chicago.

Paulson says many emerging economies such as China's are beginning to seek direct investment opportunities. The Great Lakes governors say they'll step up efforts to steer those investments into the U.S. manufacturing heartland.

The governors' council and the Paulson Institute are planning a "competitiveness forum" this summer in Detroit, led by Paulson and Michigan Gov. Rick Snyder. The partnership also will develop strategies for matching investors with opportunities, and for linking the region's research and development to foreign markets.

A screenshot of Macklemore's "Thrift Shop" / YouTube

Do you shop resale? Do you have a favorite thrift shop?

The business of selling second-hand goods has become a $13 billion industry in this country annually.

It's grown about 7% over each of the past two years.

Now you'll find resale, thrift and consignment shops in most Michigan cities and towns.

What's behind the growth? And what does this "resale" economy offer us?

We're joined by Brenda Parker. She is a professor of Urban Planning at the University of Illinois at Chicago. She recently coauthored a piece on the restructuring of retail economies in this era of e-commerce.

And we welcome Chantal McDaniel. She is based in Grand Rapids, and she writes a thrift fashion blog called "Thrift Trick: Miles of Fashion on a Shoestring."

Listen to the full interview above.

Carhartt was made in Michigan.
Carhartt / Facebook

Carhartt got its start in southern Michigan when the company's founder, Hamilton Carhartt, set out to make the best pair of overalls he could for railroad workers.

The company is still family owned and remains in Michigan.

We spoke with the company's current CEO, Mark Valade. He's Hamilton Carhartt's great-grandson.

Listen to our interview with him above.

Pete Souza / White House

President Obama was in Ann Arbor today to give a speech on raising the federal minimum wage. Prior to the speech, Mr. Obama stopped at Zingerman's Delicatessen and ordered a Reuben sandwich. 

From the White House pool report:

POTUS and motorcade stopped at Zingerman's Deli in Ann Arbor just before 1:30 p.m. With his suit coat off and U.S. Rep. Gary Peters by his side, the president ordered a Reuben sandwich.

MLPP

That's for a two-parent family with two kids and where the two parents are working.

Peter Ruark and Cameron Merrill compiled the numbers for the Michigan League for Public Policy.

Their report states that "making ends meet" means just covering the bare necessities.

If you and your partner have two kids, and you make $52,330 a year, the authors say you have just enough to cover your expenses for things like housing, food, healthcare, clothing, child care, transportation, and taxes.

It's equal to each person making $12.85 an hour at a full-time job. 

That's just one living situation the MLPP report looks at. It also breaks down the amount you would need to earn each year to "make ends meet" if you were:

  • single - $21,570
  • a single parent with two kids - $44,164
  • a two-parent family with two kids and you are both working - $52,330
  • a two-parent family with two kids and only one parent is working - $26,720

(They assume child care is not needed in a two-parent family with only one person working.) 

They also broke down the difference in need based on where you live in Michigan. Scroll over the interactive map below to see their wage estimates for each county.

Peter Martorano / Flickr

Life for a startup company is tough.

But life for a startup in Detroit may be getting a little easier.

Coworking spaces are sprouting up around the city. They've become increasingly popular across the country in the wake of the recession, according to this video from office furniture company Turnstone: 

Homeless
SamPac / creative commons

It has now been 50 years since President Lyndon Johnson declared a War on Poverty.

There is a popular perception that President Johnson's War on Poverty failed. Critics point to the official poverty rate and say it has scarcely budged from 1964 to 2014, despite the $15 trillion spent in those 50 years.

But a University of Michigan economist is challenging that view. She is co-author of a new paper that analyzes spending during the Johnson Administration, and she believes it is wrong to call the War on Poverty a failure.

Martha Bailey joined us today.

Listen to the full interview above.

Steve Carmody / Michigan Radio

Today we looked at the long-range forecast for Michigan as a whole and what it will take in terms of policy decisions and education to keep Michigan from having a future as dark and dismal as a Dickens novel.

Two writers who've explored these questions for Bridge Magazine joined us today: Ron French and Nancy Derringer.

*Listen to the full interview above.

There’s a new group called the Economic Justice Coalition which is seriously considering trying to get a proposal on the ballot to raise the minimum wage in Michigan.

You might think that would make Democrats happy. Their gubernatorial candidate, Mark Schauer, came out in favor of a minimum wage hike two months ago.

But Democratic leaders aren’t thrilled with a ballot campaign, for reasons I’ll explain in a minute. Now, it’s not that they don’t want a higher minimum wage.Virtually all of them do. Schauer said if elected, he would try to raise Michigan’s from the present $7.40 an hour to $9.25 an hour over three years.

Bytemarks / flickr

More than 1.6 million Americans have lost their unemployment insurance since the end of 2013.

Congress allowed federal legislation designed to give job seekers unemployment benefits to expire on Dec. 28.

Congressional Democrats have called on Republicans to support legislation that would revive unemployment benefits.

Sen. Jack Reed, D-Rhode Island, who authored legislation to extend unemployment benefits, said partisan gridlock could cause the number of people without unemployment benefits to double by the end of the year.

Esther Gordy Edwards started the Motown Museum in 1985. After a recent visit, Sir Paul McCartney "adopted" one of Hitsville's historic pianos and had it restored by Steinway.
user dig downtown detroit / Flickr

From Motown to Madonna, techno to gospel, jazz and blues, from Eminem to Kid Rock to Aretha, and much more, the Detroit area has been, and continues to be, a music powerhouse.

In fact, at least 38 Grammy Award winners and nominees from the past five years have a Detroit connection.

A recent study from the Anderson Economic Group takes a deep dive into the business of the Detroit-area music scene.

Alex Rosaen, the principal author of the study for the Anderson Economic Group, joined us today.

Dan Bobkoff / Changing Gears

Michigan's primary industry, the auto industry, had a boom year in 2013.  That rapid growth is expected to slow in 2014, according to Robert Dye, an economist with Comerica Bank.

So, there may not be as many auto jobs created.

But, Dye notes that West Michigan's furniture industry could experience a boom.

"As we generate more jobs nationwide, companies will start reinvesting back into their office space," says Dye.  "And so I do expect improving conditions for furniture manufacturers in Michigan."

Katy Batdorff

One of the common traditions as we end one year and begin another is taking stock — reviewing where we've been and figuring out where we want to go in the New Year.

A good place to focus that review would be finances, and the prospects for the housing market.

A consumer credit forecast was released today that can give us a look into where Michigan’s market may be headed in 2014.

Listen to the full interview above.

Planet Money published a story about used clothing trends. One T-shirt found in Kenya was originally made for a Michigan bat mitzvah in 1993.

Andy / Flickr

We turn now to what’s known as the “underground economy.”

When jobs are scarce, people will do whatever they can to put a meal on the table, pay the mortgage or the rent. Whether it's odd jobs, selling plasma, doing home repairs and getting paid under the table, people are doing it.

One economist gave a best-guess estimate of two trillion dollars worth of this underground activity in the nation last year -- that’s nearly eight percent of the Gross Domestic Product.

Reporter Lynn Moore wrote a piece about the shadow economy in Michigan and she joined us today.

*Listen to the audio above.

Half a century ago, America suffered one of the most traumatic events in our history: The assassination of President Kennedy. But while it is important to remember that, it might also be good to consider that there is a bunch of good economic news today. Good news, especially for Michigan.

Yesterday, University of Michigan economists presented their annual November forecast. They saw good things ahead, with the national economy growing almost twice as fast over the next two years as now.

Two experts from the Research Seminar in Quantitative Economics predicted five million new jobs over the next two years. Unemployment, they predict, will fall from just over seven to about six percent.

Meanwhile, they predict the automakers will sell half a million more units next year than this, more still in 2015, and the housing market will also grow.  Inflation will stay low and oil prices will remain steady. This is all very good news, if true.

user: jodelli / Flickr

This week, the Business Leaders for Michigan, the state’s most prominent business roundtable, met in Detroit.

The group offered an in-depth “report card” of how Michigan is recovering from the implosion suffered during the recession. They also outline what it’ll take to boost Michigan’s presence as a money-generating state.

We talked with Daniel Howes, a business columnist with the Detroit News, about Michigan's current business climate — and where things go from here.

Lizzie Williams / Grand Rapids Area Chamber of Commerce

Americans are less optimistic about the economy in the wake of the partial government shutdown earlier this month.

That information is coming from the University of Michigan’s "Index of Consumer Sentiment", which measures how confident consumers are in their economy.

Experts say the latest drop in consumer sentiment may impact the holiday shopping season.

From the Associated Press:

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