Many of Michigan’s woes come to rest on the residents
Between 2019 and 2021,Michigan ranked second in the nation in numeric decline in the labor force, including those among 16 to 24 year-olds, according to Michigan’s Labor Market News, for December, 2022. It was a decline of 5%.
The September 2023 issue of Michigan’s Labor Market News states that Michigan is losing a relatively large share of its young adults compared to older groups, with jobs being identified as the most important reason for moving, for both in -and-out of the state. The report also states that people moving to Michigan indicated jobs as their primary reason for moving in at a higher rate than those moving away. The Sept. 2023 edition of the publication also states that over the year, Michigan’s labor force rose by 3.2 percentage points above the national growth. But none of this addresses why the young workers are leaving Michigan faster than new one are coming in.
On August 30, 2023, CNBC ranked Michigan among the 10 worst states for high-paying entry-level jobs. The median was calculated at $21.88 per hour. Much of it has to do with fallout from the pandemic.
When it comes to factors such as job openings, hires, quits, layoffs and unemployment, between 2019 and 2023, Michigan, Pennsylvania and Alaska had some of the worst job markets in the country, CNBC reported. That, too, would hamper the availability of high-paying entry-level jobs, it says. Those are the same years considered by Michigan’s Labor Market News, as stated above.
In places that are losing population,” the report quotes Julia Pollak, chief economist at ZipRecruiter as saying, “even people in typically safe jobs like teachers are seeing one school close after another because they just don’t have the demand.” If there are fewer jobs available overall, there are, of course, fewer high-paying entry-level jobs available as well.
In the private sector, economics plays a major role in that demand. The demand for certain jobs may be there, but the cost of filling them may be more than businesses can afford to pay for them. As the U.S. Bureau of Labor Statistics points out, there are more costs associated with filling a job than just paying wages.
BLS divides the U.S. into four regions and compares them. In June, 2023, BLS released a report: Employer costs for Employee Compensation of the Regions. It reported that the Midwest region recorded an hourly wage and salary average of $27.43 in June 2023, representing 69.0 percent of all compensation costs. Total benefits averaged $12.32 and accounted for the remaining 31.0 percent of total compensation costs. Insurance benefits were $3.27 per hour worked, or 8.2 percent of compensation costs. Legally required benefits averaged $2.90, or 7.3 percent of compensation costs followed by paid leave at $2.89, or 7.3 percent of compensation costs in the Midwest.
So, while the wages paid to an employee may be $27.43, the total cost to the employer amounts to $39.76. Much of that expense explains why minimum wage increases are unpopular among employers in the private sector.
MLive on October 23, 2023, reported that a proposed ballot initiative to gradually in crease Michigan’s minimum wage to $15 per hour was blocked by the Board of State Canvassers, a four member panel composed of two Democrats and two Republicans. This created controversy between Opponents of Raise the Wage Michigan, and One Fair Wage, which, MLive reported, guided the petition through approval steps late last year.
MLive reported that the fight is headed to court after the two Republicans refused to certify an estimated 360,309 signatures to bring the measure to the ballot. The argument hinges on wording changes made to the initial proposal.
The split along party lines returns to the topic raised in a previous installment of this series, political polarization in the state hurting Michigan overall.
Trust in Michigan’s government was undermined in 2017 when Republican Governor, Rick Snyder, signed legislation allowing political candidates to raise unlimited amounts of cash for super PACs.
The increasing empowerment of lobbyists has led to many attempts by special interests to propose legislation that would shift ownership and from the local level to the state.
For example, this past July, The Keweenaw County Board of Commissioners joined other counties in supporting opposition to an attempt by downstate lobby groups to eliminate local control over sand and gravel mining operations, placing all regulatory control in the hands of the state. The three-bill package, pushed by The Michigan Aggregates Association, would strip local government of the ability to regulate operation issues that are inherently local in nature, including hours of operation, truck routes, noise, dust control and fencing. According to the Michigan Municipal League, the legislation jeopardizes existing relationships between mine operators and local governments, shifting all new and expanding operations to state oversight–under a to-be-created permitting and regulatory system within the Michigan Department of Environment, Great Lakes, and Energy (EGLE). The bills were pushed by the Michigan Aggregates Association, a lobbying group, claims it represents the sand and gravel industry.
Another bill pushed by special interest groups, in 2021, was House Bill 4722, which would limit local governmental control of Airbnb, VRBO and other short-term rental companies.
In the end, there is no single formula to resolve Michigan’s current problems. Many officials on many levels across the state have gone on record saying that political polarization has become an issue that detracts many residents. State representatives using term limits as a stepping stone to bigger and better opportunities has eroded trust in many that the people they elect have their best interests at heart. That trust is further damaged by the proliferation of “Dark Money” expanding in Michigan politics, which has been an issue among voters since 2010, when the U.S. Supreme Court’s Citizens United ruling allowing corporations and other outside sources to spend unlimited money on elections.
At the same time, as stated above, Political Action Committees (PACs), Superpacs, lobbyists and others, have increasingly gained influence among legislatures, pushing bills that benifit their members and contributors, with the general population being ignored by everyone involved.
There is also much in this series that has been not been covered, such as politics playing roles in environmental, taxing, housing, and healthcare policies, just to name a few.
Michigan’s biggest problems, it may be argued, are the result of too few Michigan residents paying attention to what their elected officials are up to in Lansing and instead, leaving them unsupervised to legislate based on the will of the special interest groups.