The primary indicators of Michigan's economic output continue to show steady improvement, but gaps in overall levels remain in key areas.

Michigan’s annual unemployment rate is approaching the average of peers and “Top Ten” states. The improvement in Michigan’s annual unemployment rate has been dramatic, dropping nearly nine percentage points since 2009. Private sector employment has exceeded the average growth in “Top Ten” states for three out of the last four years, but Michigan's labor force participation rate, while improved over the last year, remains below the “Top Ten” and peer state averages.

Per capita personal income in Michigan, while growing, remains well below peers and “Top Ten” states. Per capita personal income has experienced positive growth every year since 2009, with the exception of a small decline in 2013. Michigan per capita income growth has outpaced the average of “Top Ten” states in each of the last two years, but Michigan's 2016 per capita personal income level was over $4,000 less than the peer average and over $9,500 less than “Top Ten” states.

Despite impressive growth, a significant gap remains between Michigan’s per capita GDP levels and those of peer and “Top Ten” states. Michigan per capita GDP growth has outpaced both the peer and “Top Ten” averages in five of the last seven years, including more than double that of “Top Ten” states from 2014–2015 and nearly 10 times the "Top Ten" growth rate from 2015–2016. In spite of this impressive growth, average per capita GDP of peer states in 2016 was over $5,000 higher than Michigan's while “Top Ten” per capita GDP was nearly $12,000 higher.

Michigan’s population has stabilized, but peers and the “Top Ten” are growing faster. After losing population in 2009, 2010 and 2011, Michigan has had five straight years of either zero or positive growth. During that same period, however, peer and “Top Ten” average population growth has been as much as 10 times higher than Michigan’s.

Input - Cost and Value

In 2016, Michigan was improving or holding steady in 34 (nearly 70 percent) of the 50 indicators used to measure the cost of locating here and the value provided. However, Michigan's overall ranking remained in the bottom half of states on over half of the measures.


The perception of Michigan's overall business climate has improved significantly but is still recovering. Michigan’s business climate was considered the worst of all 50 states in 2009. In 2016, Michigan’s average ranking among the major business climate indices was 25, marking both tremendous progress and room to improve.

Michigan’s tax climate is among the best in the nation. Michigan’s corporate tax climate continues to be ranked among the 10 best in the nation and the overall business tax climate is ranked 12th.

Michigan government is generally smaller and costs less, but unfunded OPEB liabilities are larger. Total state and local government spending in Michigan is six percent lower than the peer average and 20 percent lower than “Top Ten” states. Michigan also has seven fewer government employees per 1,000 residents than peer states and nine fewer than “Top Ten” states. But Michigan's unfunded other post-employment benefits (OPEB) liabilities are nearly 16 percent higher than peers and 25 percent higher than the “Top Ten.”

Trends: Cost and Value Indicators 2015-2016


Michigan must continue to focus on workforce development. In 2016, Michigan ranked in the bottom 10 states for the percentage of 4th graders reading proficiently, the number of students enrolled in career and technical education classes, and the number of out-of-state students enrolled at our colleges and universities. Michigan also ranked in the bottom half of states for the percentage of 8th graders testing proficient in math, the percentage of high schoolers considered career and college ready, the number of critical skills degrees and certificates awarded by our colleges and universities, and the percentage of working age population with an associate's degree or higher.

Several aspects of Michigan’s infrastructure ranked near the bottom of all states. Michigan ranked 43rd for the cost and 45th for the hours of delay due to traffic congestion. We ranked 37th and 38th, respectively, for the percent of bridges and urban roads in poor condition. 

Innovation continues to be a distinguishing strength. Michigan ranked in the top ten states for the value of goods exported (6th), research and development investment by universities (5th), and patents awarded per 100,000 residents (10th).

Absolute Rankings: Cost and Value Indicators 2015-2016

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Top 10 denotes where Michigan’s level in a given metric is equal to or better than the average level for the “Top Ten” states.

Trend Comparisons

As measured by key outputs, Michigan’s economy is experiencing “Top Ten” growth. Michigan has also taken steps to improve several cost inputs, while more work is needed on key value inputs.