ANN ARBOR, Mich.--Oakland County’s economy will continue to build on the red-hot job growth of last year--its second-best performance overall since 1994 and the second-best year for its private sector since 1989, say University of Michigan economists.
Oakland gained more than 23,000 jobs in 2011 and will add nearly 34,000 more jobs through 2014--about half of them in high-paying industries.
In their annual forecast of the Oakland County economy, George Fulton and Don Grimes of the U-M Institute for Research on Labor, Employment, and the Economy say that Oakland will add about 11,000 jobs this year, another 9,500 next year and more than 13,000 in 2014.
"The Oakland County economy is undergoing a revival after suffering through the difficult years of the 2000s," Fulton said. "The rebound in the county economy has been almost as impressive as the downturn that preceded it.
"The resurgence is backed by improvements in the U.S. economy, a reborn auto industry and the county’s still-strong economic fundamentals and forward-looking policy initiatives. The sizzling pace of job growth for 2011, however, is too strong to be sustained, but the local economy can be expected to find its cruising altitude over the next few years."
Fulton and Grimes say private-sector job gains in Oakland County last year exceeded by almost 10,000 what they averaged over the 1980-2000 period, prior to the extended weakness of the 2000s. Comparable to the past two years, about half of the new private-sector jobs created over the next three years will be in high-wage industries (industries with average pay of more than $57,000)--which bodes well for Oakland’s economic prosperity, they say.
According to the forecast, the private service-providing sector will add 26,600 jobs through 2014. Nearly half of these job gains (13,100) will be in professional and business services, with another 4,400 new jobs in wholesale and retail trade, 4,200 in health services and 3,100 in leisure and hospitality (the majority in full-service restaurants). Overall job gains in the service-providing sector will be spread out over the three years: 8,200 this year, 7,900 next year and 10,500 in 2014.
The only major private-sector industry projected to lose jobs is finance and insurance, thanks to the continued relocation of Blue Cross/Blue Shield employees to downtown Detroit, the economists say.
In the goods-producing sector, which includes manufacturing, construction and natural resource industries, Fulton and Grimes predict jobs gains of about 8,000 over the next three years--more than 5,700 in manufacturing.
"At the core of manufacturing’s improvement is the resurgence of the motor vehicle manufacturing industry, where employment is forecast to increase by about 2,500 jobs, or 15 percent, over the next three years," Grimes said. "The strong rebound in manufacturing employment, overall, in 2011 and 2012 is consistent with its historical performance following a deep recession, while more moderate gains in 2013 and 2014 are typical of the later stages of an economic recovery.
"Even with the recovery, however, by 2014 manufacturing employment in the county is still
47,500 jobs, or 44 percent, below 2000 peak levels, with little chance of ever returning to anything close to those levels."
While the private sector in Oakland County will post job gains over the next three years, jobs in the government sector, which includes public education and local government administration, will continue to decline, with job losses of just under 1,000 through 2014.
As Oakland County emerges from the structural and cyclical declines of recent years, it remains among the best local economies in the country, with its coveted AAA bond rating and high ranking among 35 comparable counties in the United States on a series of measures that indicate future economic prosperity.
"Oakland ranks 12th overall--an impressive standing, considering that a number of these counties house some of the most robust local economies in the nation," Fulton said. "The county is especially noteworthy for its share of residents employed in professional and managerial occupations, and for its educated population, both of which bode well for future growth opportunities in higher-paid activities."
The 27th annual U-M forecast of Oakland County’s economy was sponsored by 11 regional organizations. Its presentation was hosted by the county’s Department of Economic Development & Community Affairs, Oakland Community College and Chase.