Speaker says Michigan economy continues to improve.

April 10, 2015

By Rob Alway. Editor-in-Chief.

VICTORY TWP. — Michigan’s economy is turning around and is continuing to improve. This was the message that Patrick Anderson of Anderson Economic Group of East Lansing told area business leaders during a symposium sponsored by West Shore Bank at West Shore Community College Friday morning.

“There were some years when talking about the Michigan economy was not a good thing,” Anderson said, referring to the first decade of the 21st century. “In the 1990s, Michigan was below the country in terms of unemployment. Under Gov. John Engler we reduced taxes and by the end of the 1990s the unemployment rate was significantly below the country as a whole. Michigan can do well when it tries.

“The exceeding decade was not good. Michigan entered the recession in a bad way.”

Anderson said the unemployment rate continues to improve and is comparable to other states in the Midwest.

One of the key changes to the Michigan economy has been the replacement of the business tax with a flat rate corporate income tax, Anderson said, adding that the Michigan corporate taxes are now easy to explain and were complicated before.

“Michigan’s tax burden was high but it’s now going down,” he said. “We are one of only five states that is moving consistently up.”

Michigan ranks 28th in the nation for tax burden and Anderson expects it to continue to improve.

Anderson said the auto industry can also take credit for helping to improve Michigan’s economy. He said the “Detroit 3” (General Motors, Ford Motors and Chrysler) have improved their products, which means consumers are buying American cars again.

He added that Michigan is one of the top states for entrepreneurs; Detroit has an equal amount of technology companies as Silicon Valley in California.

Some of the issues that Michigan faces include the upcoming sales tax increase proposal.

“You have to assume that if we raise that sales tax it is never going down,” Anderson said. “There is no plan B. Just think that if you told your customers there isn’t a plan B. You’ve got one product and there’s no plan B.”

Anderson said Michigan faces a problem with talent. “We need to think about this. We have a problem among employers finding skilled workers, particularly in the skilled trades.”

On a national level, the economy will face an issue with the pending student loan crisis, Anderson said. He added that the United States still lags behind many other countries in K-12 education and that the Affordable Care Act has caused economic challenges for many employers.

The U.S.’s national debt continues to rise.

“One of the drivers of this is the growing entitlement spending,” he said.

He said the nation also faces an issue with its view on the role of the family and how it relates to work ethic.

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