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Economists: Michigan's Low Personal Income Ranking Won't Rise Again Soon

Michigan dropped to 37th nationwide in 2009 for per capita personal income, sliding one spot as income dropped from $34,953 to $34,025. If one includes Washington D.C. in the rankings, Michigan is now 38th.

The state's 2.7 percent decline was higher than the nationwide average drop of 2.6 percent in 2009, according to a report released Thursday by the U.S. Bureau of Economic Analysis. In 2008, national per capita income rose 2.0 percent.

Michigan was 36th last year and economists don't see the state getting any better in the near future.

"The trend has been really discouraging here in Michigan," said Brad Watts, a regional analyst at the Upjohn Institute, an economic research organization. "At some point in the near future, we have to be bottoming out. I would hope in the next year or two you would see at least a leveling out and not see Michigan slipping any further."

Michigan may have settled in to its national standing, said Don Grimes, a University of Michigan economist.

The days of Michigan being a top 20 per capita income state nationwide went away with the monopoly power of the Big Three auto manufacturers, Grimes said.

"My guess is that Michigan will continue to slip a bit in the rankings through 2012, but that after that we will begin to move back up slowly toward the high 30s (37th or 38th) maybe by 2015," Grimes wrote in an e-mail. "Which I think is our new equilibrium level unless the state begins to attract more knowledge industry jobs and workers."

Watts said once the automobile crisis is settled in a year or two, Michigan will see an improvement in the rankings.

"I don't want to give up on Michigan," Watts said, adding that Michigan is strong in technology and research and development fields.

Connecticut was the state with the highest per-capita income in the country in 2009. At $54,397, it dropped slightly from 2008's $56,245.

Liz Boyd, a spokeswoman for Governor Jennifer Granholm, didn't return an e-mail seeking comment.


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Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.