Comerica Economic Update Finds Michigan Job Growth Slowing
To fuel your love of cars,
visit the Autos section.
DETROIT — A slowdown in job growth is seen in southeast Michigan by Comerica Bank as auto sales are leveling off.
Comerica’s Regional Economic Update for the Detroit area found payroll jobs in Detroit rose 0.4 percent in October, compared to a rise of 1.5 percent in October for the United States as a whole.
Comerica economists Robert Dye and Meaghan Derrick wrote that “multiple factors are shaping overall growth as we close out 2012.”
For one thing, they said, “the auto industry bailout and the subsequent gain in auto sales from a recession low of 9.0 million units (annualized) in February 2009 to post-recession high of 14.9 million units in September 2012 have brought tens of thousands of jobs back to the Detroit area. However, gains in manufacturing employment are now flattening out.”
They wrote that predicted auto sales gains in the next two years will add far fewer local jobs than the sales gains int he last two years. And, they said, government employment continues to fall.
On the bright side, housing prices are firming up and construction is picking up, but there’s still a high housing vacancy rate to work through.
Overall, the region’s jobless rate is predicted to drop from the current 10.8 percent to 8.6 percent by 2014. Migration out of the region, however, will continue. Housing starts in the region will hover between 4,000 and 5,000 units at an annual rate through 2014.
Comerica also produces a Regional Economic Update for what it calls Central West Michigan, which includes the Grand Rapids, Kalamazoo and Ann Arbor areas. This region, Comerica predicts, will be supported by a “vibrant Ann Arbor.” This region saw its jobless rate improve to 6.7 percent in the third quarter, better than the state average of 8.2 percent.
Comerica observed that Ann Arbor maintains the lowest unemployment rate of the region, at 5.0 percent, although Grand Rapids, Kalamazoo and Lansing have unemployment rates at or below 6.5 percent as of September.
Payrolls in the auto manufacturing sector are declining slightly, and office furniture demand is flat. Also, home prices fell 2.6 percent in the region in 2011, compared with a 4.3 percent decline nationally. Prices are predicted to stabilize, moving into positive territory in 2013.
The economists wrote that the region “faces economic challenges stemming from relatively weak population growth.”
The region’s jobless rate is predicted to fall from the current 7.4 percent to 6.1 percent by 2014. Housing starts are predicted to hover between 2,000 and 3,000 a year in the region.