(The Center Square) – Michigan’s economy is at a turning point, with both political sides pointing to different solutions for how to move it in a positive direction.
While Gov. Gretchen Whitmer, a Democrat, says the state is headed in the “right direction,” others are concerned that it is slowly “falling behind” other states across the country.
“Michigan took steps back under the state Democratic party’s control,” James Hohman, the director of fiscal policy at the Mackinac Center for Public Policy, told The Center Square. “Michigan is falling behind and will continue to do so unless lawmakers do something to unlock the private sector’s potential.”
Hohman recently authored a report looking at the economic trends for Michigan going into 2025, which highlighted “stagnant” job and population growth.
“Michigan’s economy continued to grow in 2024, but the growth rate should have elected officials concerned,” the report said. “The state is not performing up to national averages, and Michigan is already behind many of the average levels of prosperity.”
Data from the U.S. Census Bureau for 2024 found while Michigan had a gain in population over the past year, it was driven by international migration.
This came after a few years of net loss in the state’s population, which should concern the state’s politicians, Hohman said.
“That Michigan’s state population has been stuck at 10 million people for a generation is strange,” he explained. “We are part of a growing country and most of the states are adding people.”
Yet, Democrats, who held a political trifecta in the state from 2022-2024, remain confident in the state’s direction.
“Michigan’s economy [is] headed in the right direction thanks to our hardworking people, innovative businesses, and strategic financial management,” Whitmer recently said. “State revenues came in higher than expected, and the future looks bright—our economy is projected to grow faster in the years ahead.”
Whitmer is also hopeful this will continue in the year to come.
“In 2025, we’ll build on the work we’ve done over the last few years to create jobs, grow the economy, reinvest in our workers and businesses, and lower costs for families on everything from school meals to housing to child care,” she said.
A Economic Outlook report from the state House Fiscal Agency released in 2024 laid out predictions for the coming few years.
In 2025, it predicted that Michigan’s unemployment rate will increase, though incomes will also likely slightly increase.
Republicans argue Whitmer’s claims of success are an illusion, especially after a recent report from WalletHub – a personal finance website – found that Detroit ranked second worst in the nation for jobs going into 2025.
“This is what happens when you have a governor obsessed with raising taxes and suffocating businesses,” said Republican state Senate Minority Leader Aric Nesbitt, who also recently announced he plans to run for governor in 2026. “It’s no wonder why our population is declining. Gretchen Whitmer has killed the Michigan job market.”
Hohman said that the Michigan government needs to take a totally new approach to governing, which would encourage economic growth.
“States grow because they have great business climates where entrepreneurs and business leaders can grow their businesses without interference and without undue burdens. They give people the freedom to pursue their opportunities,” he told The Center Square. “I hope Michigan lawmakers realize this because their efforts in chasing the latest economic fads have been fruitless.”
