lent upson lecture in public administration at wayne state universit
DESCRIPTION
Lou Glazer's May 17 presentation as part of his Lent Upson Lecture in Public Administration at Wayne State University, with new information on states leading in private sector per capita income."TRANSCRIPT
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www.michiganfuture.org
Lent Upson Lecture in Public Administration
May 17, 2012
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Our goal
A high prosperity
Michigan
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Making the case for
A New Michigan
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What state do we want to emulate?
State Per capita
income
Unemployment Poverty
rate
Education
attainment
Oklahoma $35,389 6.2% 16.9 % 22.7 %
Minnesota $42,798 6.4 % 11.6 % 31.5 %
Michigan $34,714 10.3% 16.8 % 24.6%
U.S. $39,937 8.9 % 15.3 % 27.9 %
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Top 10 states in per capita income
5
Connecticut
Massachusetts
New Jersey
Maryland
New York
Wyoming
Virginia
Alaska
New Hampshire
North Dakota
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Components of per capita income
• Private employment earnings
• Government employment earnings
• Investment earnings
• Government transfer payments
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Top 10 states in private sector earnings (except natural resources)
7
Massachusetts
Connecticut
New York
New Jersey
Minnesota
New Hampshire
Illinois
Delaware
Colorado
California
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Bottom 10 states in private sector earnings (except natural resources)
8
Arkansas
Idaho
New Mexico
West Virginia
Mississippi
Alabama
Oklahoma
Kentucky
Montana
South Carolina
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Best states in private income
Top 10
Private, Non-Nat ResourcesEarnings Share of PI
Gov’t. Earnings & Transfers Share of PI
Massachusetts $34,082 66.4% 25.8%
Connecticut $33,460 61.7% 24.6%
New York $31,510 64.8% 31.4%
New Jersey $29,036 56.8% 26.3%
Minnesota $26,823 62.7% 27.8%
New Hampshire $26,347 60.3% 24.6%
Illinois $26,081 62.0% 28.4%
Delaware $25,979 64.8% 32.4%
Colorado $25,322 59.9% 27.5%
California $24,882 58.5% 29.4%
United States $23,149 58.0 31.9%
Michigan $19,817 57.1% 35.6%
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Worst states in private income
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Bottom 10
Private, Non-Nat ResourcesEarnings Share of PI
Gov’t. Earnings & Transfers Share of PI
Alabama $17,121 51.10% 39.70%
Oklahoma $17,078 48.30% 37.50%
Kentucky $17,021 52.70% 41.40%
South Carolina $16,756 51.60% 39.70%
Montana $16,689 47.60% 36.70%
Arkansas $16,636 50.70% 38.10%
Idaho $16,553 51.90% 33.50%
New Mexico $15,130 45.40% 42.40%
West Virginia $14,545 45.40% 43.30%
Mississippi $14,358 46.20% 43.00%
Michigan $19,817 57.1% 35.6%
United States $23,149 58.0% 31.9%
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What state do we want to emulate?
State Per Capita Income(total)
Private, Non-Nat ResourcesEarnings
U Poverty
rate
Education
attainment
Indiana $33,981 $20,064 9.0% 15.3 % 22.5 %
Minnesota $42,798 $26,026 6.4 % 11.6 % 31.5 %
Michigan $34,714 $19,545 10.3% 16.8 % 24.6%
U.S. $39,937 $22,758 8.9 % 15.3 % 27.9 %
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Traits of prosperous states
• High proportion of wages from knowledge
industries
• High proportion of college grads
• Big metro with higher per cap income than state
• Largest city in that metro has high proportion of
college grads
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What is the knowledge economy?
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goods5% information
5%
trade trans utilities
7%
financial activities
11%
prof and business services
17%education
21%
health21%
leisure other services
3%
public administration
10%
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Michigan’s income rank aligned
with our college attainment rank
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15
20
25
30
35
40
Per Cap Income % 4 year degree
18
34
39
36
2000 2010
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10 Most Prosperous Regions
• San Jose/San Fran.
• Washington/Balt.
• NY/Newark
• Hartford
• Boston/Worchester
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• Seattle
• Houston
• San Diego
• Denver/Boulder
• Philadelphia
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Major metros smarter
Under .2 m .2-.5 m.5-1 m
1-1.6 m1.6-3 m
3 m +
23 24 25 2630
33
Percent Education Attainment by Metro Population
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Major metros richer
Under .2 m
.2-.5 m.5-1 m
1-1.6 m1.6-3 m
3 m +
$33,304 $35,304 $35,734 $37,470 $39,490
$45,167
Per capita income by metro population
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Big metros winning
in private sector earnings
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CSAs and non-CSA MSAs Population
Private employment earnings per
capita
Private employment earnings as share of PI
Government revenue as share of PI
3.0 million or more $28,768 64.2% 26.1%
1.0 - 3.0 million $22,684 60.2% 31.7%
500,000 - 1.0 million $19,577 54.9% 34.4%
200,000 - 500,000 $18,800 52.9% 36.7%
under 200,000 $17,203 51.2% 40.4%
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Metro Detroit vs.
Metro Minneapolis
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2009 Rank among 55 metros 1 million
population or more
City Per cap
income
Education
attainment
Share of wages from
knowledge industry
Minneapolis 11 7 13
Detroit 41 39 31
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Metro Grand Rapids vs.
Metro Minneapolis
City Per cap
income
Education
attainment
Share of wages from
knowledge industry
Minneapolis 11 7 13
Grand Rapids 54 44 54
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2009 Rank among 55 metros 1 million
population or more
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Metro Lansing vs. Metro Madison
City Per cap
income
% bachelors
degree or more
Share of wages from
knowledge industries
Madison $ 42,456 38.90 % 63.61 %
Lansing $ 33,273 29.09 % 65.33 %
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2009 data
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Traits of prosperous states
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Top 10 Private expect Natural
Resources
Big Metro (3 million or more)
Big Metro College Attainment
Massachusetts Boston 37.5%
Connecticut New York 35.6%
New York New York 35.6%
New Jersey New York/Philadelphia 35.6% / 31.3%
Minnesota Minneapolis 36.2%
New Hampshire Boston 37.5%
Illinois Chicago 33.2%
Delaware Philadelphia 31.3%
Colorado Denver 38.5%
California Los Angeles / San Jose /
San Diego
27.8% / 41.4 /
34.6
Michigan (36th) Detroit 26.7
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What about jobs?
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High education industries
growing in U.S.
-6.00%
-4.00%
-2.00%
0.00%
2.00%
4.00%
6.00%
-0.79%
-5.79%
5.83%
All industry
Low education
High education
(2009 average wage)
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Em
plo
ym
ent
ch
ange 2
001-0
9
$45,558
$33,383
$59,926
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High education industries
doing best in Michigan
-25.00%
-20.00%
-15.00%
-10.00%
-5.00%
0.00%
-15.66%
-22.59%
-4.97%
All industry
Low education
High education
(2009 average wage)
25
Em
plo
ym
ent
ch
ange 2
001-0
9
$43,645
$34,646
$54,964
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Recession accelerates trends
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75.0
80.0
85.0
90.0
95.0
100.0
105.0
Michigan and US Private Sector Employment, by industry educational attainment, 12/07 to 03/12
MI priv more edu MI priv less educ US priv more edu US priv less educ
Ind
ex
va
lue
(10
0 in
Dec
. 2
00
7
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Our conclusion:
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The places with the greatest
concentration of talent win!
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Younger college grads
Blue = With children
Red = Without children
Young talent is
aggregating in
urban regions
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What should be
Michigan’s
new agenda?
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In the 20th century, the most valuable
assets to job creators were financial and
material capital.
In a changing global economy, that is no
longer the case. Today, talent has
surpassed other resources as the driver of
economic growth.
Governor Rick SnyderSpecial Message on Talent
December 1, 2011
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The purpose of the exercise: It is not simply
to reduce the deficit, but to ensure
prosperity. Solvency is vital, but it is not
enough.
Thomas Friedman
Michael MandelbaumThat Used To Be Us
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In the long run, America will be richer than
China only by having smarter citizens, and
that requires the skills that come from
schools and cities, not dispersed factories.
Edward GlaeserNew Times Economix blog
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Our recommendations
• Align Michigan culture with the flat world realities
• Create places where talent wants to live
• Ensure success of vibrant higher ed system
• Reinvent K-12 education to align with new realities
• Develop new public and – more importantly –
private sector leaders
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Bottom line
We must get younger
and better educated
or
we will get poorer
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For more information about Michigan
Future, our reports or what the media is
saying, please visit our Web site at:
www.MichiganFuture.org
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www.michiganfuture.org
Lent Upson Lecture in Public Administration
May 17, 2012