The Future of Michigans Labor Force
August 12, 2020
State forecasters predict negligible job growth in Michigan through 2028, largely due to declining birth rates, baby boomer retirements and less than robust workforce participation among those under 55, according to a report released Aug. 6 by the Michigan Department of Technology, Management and Budget.
While some job sectors are expected to expand substantially - construction, education and health services - over the period, others - retail, other services and government- are likely to remain flat or decline, officials said at the biennial Michigan Occupational Outlook teleconference.
“Michigan is facing substantial downward pressure” on potential growth in its labor force, said DTMB Demographic Analyst Alan Leach.
“There are just not enough native born (Michiganders) to replace retiring baby boomers,” he said. Coupled with historically modest net migration to the state and less than maximum participation in the workforce by younger residents, prospects for an overall jobs boom are limited, Leach said.
Job opportunities for those who are here, looking for work and have sufficient experience or educational credentials will nevertheless be plentiful, the analysts said.
Employment Projections Specialist Kevin Doyle said Michigan entered the decade with historically low levels of unemployment (4.1%), such that there “are just not enough workers or slack in the job market to create (substantial) job growth.”
The report’s bottom line - a mere 3,000 jobs added to the Michigan 4.9 million labor force through 2028 - an increase of about .13%, Doyle said.
DTMB officials noted repeatedly that their projections were largely developed prior to the COVID-19 pandemic, and do not account for potential structural changes in the economy it may precipitate.
Despite the sometimes bleak forecast, state analysts said the Michigan economy will remain dynamic, with up to 500,000 job openings created annually as current workers retire or change occupations.
As some sectors decline - e.g. traditional news and media operations - others, like data processing and Internet-related information services, will expand, they said.
With Michigan’s population aging, the growth in personal and health care services will be substantial. Likewise, construction, skilled trades, computer controlled machine operators will be in high demand.
A report on the state’s top job prospects and the skills needed to secure them in coming years accompanied the presentation.
Demographer Leach said in an interview following the conference that Michigan is not an outlier nationally. Low birth rates among native born Americans have been observed for several decades, he said, and some states have substantially lower rates than Michigan.
In the past, birth rates have traditionally fallen during times of economic hardship and recovered in good times, Leach said. The notable thing about the period following the 2008-09 recession is the absence of a baby rebound, he said.
Michigan does have room for labor force growth above the current projections, Leach said. It is possible lower workforce participation by younger people (especially the 16-24 age group) could
be merely a temporary phenomenon in which their focus is on training and education rather than work, he said.
Similarly, Michigan’s recent tradition of negative net migration to the state could be offset if potential immigrants, both domestic and international, perceive the state presents ample economic opportunity.
To view the report in its entirety, visit https://milmi.org/datasearch/projections-excel