Michigan Caught Between the Double Pincers of Unemployment and Foreclosures

Michigan is struggling caught between the double pincers of unemployment and foreclosures. It has the highest unemployment rate from 2006. The predictions are that in June it will spike to 15.2% and keep on going up before finally taking an about turn. The state has never quite recovered after the 2001 recession.
The collapse of the auto industry has had an indirect effect on other sectors. Michael Van Fossen of Lansing once had an income of $50,000 per annum with additional benefits as a surveyor of land. He is now browsing through job advertisements for opening in other sectors as well as finishing his degree in business administration. There was a time when there was hectic activity while subdivisions were being built. Fossen could not handle all the work rolling in. But in just one year he got laid off from two surveying jobs. His wife looks after a modest business dealing with grooming of pets but with the economy being tight the people are not much concerned about sprucing up their house pets. Although their two small children are covered by Medicaid the couple is not covered. In November his employment comes to a close.

To fight the battle against unemployment the administration in Michigan is actively following the policy of giving encouragement to industries dealing with “green” technology. The state boasts of a highly skilled working group. Generous tax breaks are being offered together with other incentives.
The plans have met with partial success. Johnson Controls-Saft Advanced Power Solutions has opened a plant for assembling batteries in western part of Michigan. General Electric has come forward to invest $100 billion for the development of software and manufacturing of units connected with renewable energy like gas operated turbines and the like.

Michigan is also focusing on diversifying its economy from manufacturing to promoting tourism and giving attention to its agricultural products, health schemes, printing and innovations in pharmacology.

But any return to prosperity will not happen overnight – it will take time.

Over 450,000 jobs in the manufacturing sector have been lost from the middle of 2000. The hardest hit was the automobile production units. By the end of 2010 General Motors will shut down five of its plants in Michigan. The auto suppliers are in grave trouble. By the end of the 2010 jobs connected with the auto industry will drop to less than 100,000 – this despite the fact that Michigan has been chosen for the production of next set of sub-compact cars of General Motors.