Some see an augering in, some see opportunity

My day job is at a company in the Metro Detroit area. Metro Detroit, and actually Michigan in general is a very nice state. This is a good place. There are good people here. Prices are reasonable, cost of living isn’t terrible, and for the moment, taxes are under control.

The problem is that the area is completely dependent upon the fortunes of the US auto manufacturers.
Since manufacturing continues its effort to seek out and use the lowest cost systems, Metro Detroit and Michigan will continue to hemorrhage jobs in this area. Rumblings from the unions indicate that they don’t plan to take this lying down, but no matter what they do, the invisible hand of the market forces will continue to act rationally.
No one ever said that rational was fair. It isn’t. Life isn’t fair.
There is much hand wringing in the state. Large employers are shuttering facilities and leaving. Our governer was happy to announce 1000 new sales and marketing jobs for Google in Ann Arbor. Unfortunately we lost Pfizer shortly after that, and 2500+ highly skilled, highly educated workers.
The problem is, no one is seeing the obvious solutions. They are all falling back into their characters: liberals and democrats want to tax us into submission, and the republicans want to apply death by a thousand budget cuts.
No one, not one of the politicians has focused upon what they need to focus upon.
To grow an economy, you need a) companies that are or want to grow, b) resources, space to grow into, c) encouragement for them to take risks that result in growth.
Companies that are growing or want to grow are small companies. They need a place to start and grow, resources to make this happen. They will hire people, pay them wages, pay taxes.
Put another way, all the engineers, scientists, researchers that are wondering about their future as they look at their pink slips, do our leaders want them to pick up and leave? Or do they want to figure out a way to enable them to join or start a new company, to build revenue for the companies and a tax base for the state?
Right now, the answer appears to be yes. The state government is falling all over itself attempting to figure out which program to cut, which accounting trick to employ, which new tax to create.
All the while failing to realize that what it needs to do is figure out how to enable these highly educated, highly talented people to take positions in the state. Positions with small companies, or as important, create jobs by creating small companies.
This requires capital. This requires commitment. This requires an ability to take and stomach a risk.
The state has had an on-again-off-again life sciences corridor for a few years, spending a miserly pittance in a manner that has not been conducive to what needs to be done.
The state needs to get into company creation mode, it needs to take risks. It needs to let other take risks.
Yes, some, possibly most of these risks won’t pay off. But enough will. But not risks once, but risks all of the time. And not in one area.
Because if the state can demonstrate determination and commitment to enabling people to take risks and start and join small companies, to try to turn them into larger companies, what do you think will happen to the vast fields of highly educated talent just turned into job seekers? What will happen to the tax base?
Yes, its a risk. No not all the risks will work.
There are no guarantees in life. Life itself is not fair. You can adapt to the environment you find yourself in, or wring your hands and give up.
Lets hope our leaders stop with the latter and work on the former. The talent is out there. Its simply a question of will, and resources.
Because if they give up and start down their time honored and broken past, and don’t invest in the state and its people, then why should we? We are the small guys. We take risks. If the state won’t bet on its advantages and assets, make this not just small business friendly, but outright encouraging, why should we stay and invest in something they are unwilling to?
They need to think on that. Long and hard.

3 thoughts on “Some see an augering in, some see opportunity”

  1. The crime rate in which areas? Please understand that Dearborn is not known for its crime, nor is Warren, and Auburn Hills. Detroit is known for crime, but around Wayne State University, in Greektown, Foxtown. etc it is quite good and relatively safe. This is true though in many big cities. Though as Detroit just slipped under 1M people, it might not be classifiable as “big” for much longer.
    The issues that exist here in Michigan are multi-fold. They are compounded by an obscene lack of investment capital. If you are not working on medical devices in Michigan, you pretty much are DOA. (note: this is an issue for us as we cannot get local interest in high performance highly scalable storage and high performance computing in general).
    This could be a good place to build a business. Prices are great, burn rate is relatively low compared to other areas. You get more value per invested $, and they last longer. Salaries are midwestern, not California-like. Again, you can get more value with smaller investments, and they last longer.
    The problem is a fundamental lack of focus by government at all levels in the solution (growing the economy) to the problem (shrinking of the economy).

  2. Having just recently bought a house in Michigan, I’m not too excited about the continuing demise of the big 3. My feelings are divided though: I believe the UAW is almost entirely* to blame, and the (American) auto industry is just beginning to reap the consequences of their actions – and possibly too late to do anything about it. A big part of me wants to welcome “reality” back into the Michigan economy, even if it means economic hardship for the time being.
    One of the best articles I’ve read about it is “Where would GM be without the United Automobile Workers Union” by George Reisman. A quick google search can find it easily… It’s dead on.
    * Obviously, we have a lot more problems than just the UAW, but it embodies an attitude that seems all too common…

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