- Michigan’s population has declined the past two years and will continue to do so if nothing is done
- The problem is the result of a combination of out-of-state migration and falling birth rates
- Business leaders said the population will become a bigger issue in coming years.
For years, there has been an ongoing conversation among economists, demographers and lawmakers about Michigan’s population growth, yet little has been done to fix it. Now, the clock is ticking as the population is expected to decline and hurt the economy.
Businesses across the state are in search of workers in every field ranging from education to fast-food restaurants. Many businesses, especially in the Upper Peninsula, had to close their doors for good because they couldn’t find enough employees.
Other companies in Michigan have struggled to retain workers too, which makes them reluctant to expand in the state and discourages businesses in other states from coming to Michigan.
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What’s at stake
Michigan is still an economic powerhouse, the 10th-biggest state in the nation, with just over 10 million people.
But its growth rate has slowed considerably, ranking 49th in population growth since 1990, ahead of only West Virginia. Michigan’s population has been stagnant over the last 20 years, declining, then rebounding a bit and now declining again in the past two years.
The issue is raising a lot of eyebrows lately. This week, the Citizens Research Council of Michigan and Altarum, a nonprofit focused on health, issued a report warning that Michigan has “fallen behind other states in population growth, jobs, earnings, health, educational achievement, and the quality of public services at the state and local levels.”
One of the biggest issues is that there are more people leaving the state than there are people coming in. Rental companies U-Haul and Atlas Van Lines said in January that Michigan was in the top 5 for the highest percentage of one-way trips out of state in 2022.
Census data suggests Michigan retirees continue to leave for the Sun Belt, the southern tier of the United States, while educated workers are moving to places like North Carolina and Virginia.
In the next 25 years, the number of retirees in Michigan is expected to surpass working-age people, 25-64.
That’s not all. There are more deaths than births in Michigan and while some of this is due to COVID, the trend is expected to get worse. Immigration does a little to help, it still won’t be enough to outweigh out-of-state migration and the amount of births there are compared to deaths. Even if immigration returned to pre-pandemic levels when 22,000 moved to Michigan from other countries, it wouldn’t offset losses.
How it affects quality-of-life
More people moving out of the state and fewer babies being born puts Michigan’s economy in a tough spot. Ohio, Indiana, and every other state in the Midwest is growing faster than Michigan.
Michigan ranked 19th in median household income in 1990. By 2020, it was 32nd, with the median household bringing in $59,600 a year — more than $6,000 below the national average.
In 1990, Michigan and Minnesota had similar median household incomes. Since then, Minnesota’s population grew at more than three times the rate of Michigan (30 percent, compared to 8.4 percent). Today, the average Minnesota household brings in $15,000 more per year than those in Michigan ($74,000 in Minnesota, compared to $59,000 here).
The same can be said about home values. The average Michigan home in 2000 was worth 11 percent less than the national average. In 2020, it was 34 percent less.
Similar comparisons can be made with other Midwestern states and Michigan, with the Great Lakes State being on the losing side.
What people say
Bridge spoke to economists who said population growth has taken its toll on businesses and will become worse if nothing is done about it.
“What makes it especially challenging here in Michigan is that not only is the size of the population stagnating and eventually starting to fall, but all of the growth is coming from the retirement age population, (not) the workforce age,” said Ani Turner, program director for health economics and policy for Altarum, the health policy nonprofit, that wrote the population report.
Business leaders who spoke to Bridge agreed.
“The availability of workforce is a top — if not the top — concern of growing businesses,” said Brian Calley, president of the Small Business Association of Michigan and lieutenant governor under Rick Snyder from 2011-18. “It’s not going to get any easier anytime soon.”
“As hard as it is today, it’ll be harder tomorrow.”
What can be done?
The Citizens Research Council and Altarum report offers recommendations on what the state should prioritize to help slow the population decline:
- Refocus on the opportunities and well-being of Michiganders, to improve health, educational achievement and job readiness
- Invest in the public services and natural resources
- Attract new residents including immigrants, those relocating due to climate change and remote workers who can choose where they live