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Michigan: The Start-Over State? September 18, 2006

Posted by Tom in Community, Economic Development, Opinion, Workforce.

The announcement of the radical revisioning and downsizing of Ford Motor Company has had a deep impact on the people of Michigan, and it has opened up the question of where Michigan might be best focussing its efforts – trying to stem “brain drain” or working to help incumbent workers retool their skills for a future in the Great Lakes State. The Detroit Free Press editorial board raises the serious question of rethinking this policy issue.

The answer to that simple question has profound workforce and economic development implications for the state – and every other state affected by Ford’s recent move. It also gets to the heart of a larger matter – that of the prioritization of one demographic group over another…and how to perhaps address the incumbent workforce challengee. The Freep explains further:

Too much attention — not all of it justified — is going to the feared departure from Michigan of young people. A lot less attention gets paid to retaining and/or retraining older workers who, as the chart here indicates, really do appear to be heading for the exits. With all the buyouts and retirement offers on the table, they will be taking a lot of money with them.

State demographer Kenneth Darga warns against putting too much emphasis on any one trend. But Michigan cannot afford to dismiss the potential for economic disruption created by and among people in their mid-40s and just beyond, especially as auto industry buyouts gather steam. The people most likely to be leaving their jobs — and perhaps the state — have houses and cabins Up North to sell, contributing to the current real estate market glut.

If they go, they may never return to hunt, fish or snowmobile. They won’t be buying their next refrigerator or car here. It doesn’t seem like a plus for the state if those taking buyouts spend that money elsewhere — or if seasoned workers who do stay sit at home because they can’t figure out what else do.

What Michigan needs is a strategy to shine as “the start over state,” building a mind-set that embraces second chances and entrepreneurial leaps. There are a lot of skills and good work habits in this age group that could be unleashed into the Michigan economy.

It’s difficult to buck the tide of public opinion, and public opinion right now is focussed on the brain drain. I just completed a series of town hall-style briefings on the State of the Workforce in northeast Indiana – one focussing attention on the emerging workforce and the brain drain. Speaking from experience, the brain drain issue is very relevant in the industrial Midwest.  And it cannot be pushed aside.

At the same time, the Free Press editorial reminds me of one of the undercurrent topics of discussion – that of preserving high-wage, lower-skilled jobs so northeast Indiana would not have to face challenges like those described by the Free Press.

Northeast Indiana has taken the auto industry restructuring particularly hard; one of the pillars of the regional economy is the supportive manufacturing services offered to the domestic auto industry. The message from Detroit is clear, however: there will be no return to the auto industry of yesteryear. Thus, I wonder if effort spent on “preserving jobs” (presumably through financial concessions by local governments) is the best action. What of proactively retraining incumbent workers? What of offering regional auto suppliers financial assistance in developing new, more stable markets?

There has to be a better way. The Free Press editorial board does an excellent job reframing the issue; the question now is, what do we do with that new perspective.



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