Five Qs: Michael Finney of the Michigan Economic Development Corp.

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tMichael Finney, president and CEO of the Michigan Economic Development Corp., spoke with DBusiness Daily News about Michigan’s strengths as well as the steps the state needs to take to be successful.

t1. DDN: How would you describe the current state of Michigan’s economic situation?

tMF: All of the major indicators are trending positive. We’re seeing job growth, and the outlook from businesses tends to be positive. The forecast for continued car sales in North America is trending positive, so that bodes well for the state’s long-term economic success.

tThere are still difficult spots. We are really concentrating our efforts on four of our cities — Saginaw, Flint, Pontiac, and Detroit — because they had a much more significant economic downturn than many other areas. We know that there’s still a need for significant economic development and other support in those communities. So it really depends, but overall, things are going well, and many of the business climate changes that have been made are sending the right signals to companies that are looking to locate, expand, or start up in Michigan.

t2. DDN: What are some of those changes?

tMF: Going back to 2011 and 2012, the major change from the Michigan Business Tax to the Corporate Income Tax was fairly dramatic because it moved Michigan from being the second worst business tax state (in the nation) to being among the top 10. And then, fast forwarding to the beginning of this month, the personal property tax was eliminated on business assets, that was even a bigger signal in terms of business climate changes.

tWe’ve made a lot of regulatory reform — at last count, I think we were approaching 2,000 rules and regulations that have been eliminated that really served no purpose other than to slow down business. So it’s those kinds of changes that have had a fairly dramatic impact on the business climate and the attitude of business leaders in our state.

t3. DDN: How does Michigan compare to the rest of the country in terms of GDP and employment growth?

tMF: Michigan is definitely leading the nation in terms of job growth, and in manufacturing in particular. We’ve added more than 120,000 manufacturing jobs (since 2009). And the impact of those manufacturing jobs — when you make things, the multiplier effect of that across other industries, whether it’s retail, entertainment, and so on — is pretty phenomenal.

tWe’ve done slightly better than the rest of the nation overall in terms of GDP growth, which is important because Michigan has historically been a GDP leader. We fell off a bit during the 2000s in particular, and now we are in a nice comeback mode.

t4. DDN: What other challenges is the state facing?

tMF: There are a lot of jobs available in the state right now. We estimate that there are about 160,000 jobs that are available, and we do have a bit of a talent mismatch. In other words, these are jobs that require a level of skill. Some are in the skilled trades like welding and specialty machining, and then others are professional and technical jobs in engineering, IT, and software. We have to make sure that our education institutions are focused on delivering the kind of educational opportunities that will support the occupations that are immediately available, and will likely be available in the foreseeable future.

t5. DDN: What do you attribute to the lack of qualified talent in the state? 

tMF: Actually, it’s not just the state of Michigan — the nation is struggling with this talent mismatch. I talk to my peers around the country, and they are similarly situated as Michigan. I think what happened is that during the economic downturn, we had a lot of fairly young folks, those that were of retirement age or eligible to retire, who retired. And unfortunately, we didn’t have a good pipeline of talent behind those to actively fill many of the available positions.

tAnother contributing factor is the lack of good immigration policy in our nation. We educate a lot of foreign nationals here at our best universities. They’re earning advanced degrees in many cases and they’re earning them in some of the high-demand disciplines. But unfortunately, because we don’t have good immigration policy, many of those individuals end up having to leave the United States and go other places to apply their educational skills. We would love to see many of them stay here in the U.S., in Michigan in particular. That needs to be addressed at some point and hopefully that will happen at the national level.

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