The economy is booming, but is metro Detroit's?

Posted at 12:05 PM, Sep 26, 2018
and last updated 2018-09-26 12:05:07-04

The economy appears to be booming, and some experts are predicting we’re recession-proof. Others debate that recent signs, such as a historically low unemployment rate, could actually spell danger.

Finding agreement on the long-term forecast of the economy is hard to do — some, like Oakland University professor Jonathan Silberman, joke that it’s why it’s a “hazardous business.”

That said, there’s some good news for the local economy — important because metro Detroit was among the hardest hit areas across the nation the last time a recession arrived. According to Silberman, the area watched steady growth despite a drop in auto sales last year. That’s a situation we haven’t seen in decades.

“Metro Detroit basically tracked the U.S. manufacturing rates for 20 years,” explained Silberman. “Almost perfectly. Of course that was almost straight down, but recently there has been a rebound in the U.S. and the rebound in metro Detroit has been much stronger.”

The region still heavily relies on the auto industry, but there’s other positive signs. Silberman said that we’ve seen diversification with Quicken Loans and other mortgage companies. There were huge numbers of building permits for both industrial and residential — a positive indicator.

“If you ride around town you see a lot of it,” said Silberman.

Michigan certainly isn’t alone — the President has touted big economic growth numbers.

“Our economy is the strongest it’s ever been in the history of our country,” said Trump in a recent video release from the White House. “You just have to look at the numbers: unemployment rates at all-time historic lows.”

In Michigan we saw growth at a roughly 3-percent rate last year. This year the growth has slowed to 2-percent. The bigger concern moving forward will be whether tariffs and the latest talks surrounding new NAFTA talks have long-term effects on automobile parts manufacturers.