Image: Michigan Gov. Jennifer Granholm
Carlos Osorio  /  AP file
Michigan Gov. Jennifer Granholm looks over the Jeep Commander assembly line during a visit to the Jefferson North Assembly plant in Detroit.
updated 3/5/2007 7:57:18 AM ET 2007-03-05T12:57:18

Laid-off factory worker Bob Rose fiddles with an unlit cigar and strokes his salt-and-pepper beard as he contemplates his future in Michigan.

He's not sure he has one.

Rose, 53, lost his job when an auto supplier closed nearly two years ago. His unemployment benefits run out in early April. None of the 20-plus jobs he has applied for has panned out. And when he asks headhunters about manufacturing employment options in his home state, the news isn't good.

"I say I'd like to stay in Michigan, and they say there is no work in Michigan," says Rose, taking a break from a worker retraining class at Mid Michigan Community College in Harrison. "You have to go to Tennessee, Illinois, Indiana — anywhere out of the state of Michigan."

As the home of Ford Motor Co., General Motors Corp. and the domestic division of DaimlerChrysler AG — as well as many suppliers — Michigan has borne the brunt of domestic automakers' decisions to close factories and cut workers. Efforts to lure high-tech and life science companies haven't been enough to offset the loss of auto-related jobs.

Rose lives in Prudenville, surrounded by the plentiful lakes and forests of the state's northern Lower Peninsula. Several counties in the region have unemployment rates near or above 10 percent, causing a swarm of job seekers whenever a new opportunity arises.

About 3,000 people applied for 150 available jobs at a Menards home improvement store opened in Mount Pleasant in February. Employers are seeing similar waves of applicants for many types of jobs.

But Michigan isn't creating many new positions. Unlike other states that more closely mirror the January national unemployment rate of 4.6 percent, Michigan's unemployment rate has largely hovered around 7 percent for the past four years. In December, the latest state rate available, it hit 7.1 percent — second-highest in the nation behind Mississippi.

Image: Real estage signs
Carlos Osorio  /  AP file
Real estate agent's signs line a Birmingham, Mich., street.

Even if things turned around tomorrow, economists say it will take years before Michigan regains the jobs lost since state nonfarm seasonally adjusted employment peaked in June 2000. The state has lost more than 300,000 jobs — mostly in manufacturing — since then. The job loss has slowed in recent years but is expected to continue into 2008 as auto companies continue to cut back.

Per-person personal income has been below the national average since 2000. The housing market has struggled, with sales of existing homes dipping by more than 20 percent in some parts of the state last year. Foreclosures and personal bankruptcies have soared. Michigan has lost an estimated 22,500 people between the ages of 18 and 24 since 2000, one of the nation's highest outmigration rates.

Even the satire publication The Onion piled on recently in a mock article about Michigan closing its statewide unemployment offices. The benefits branches, the article joked, had "formed the backbone of the state economy" by providing jobs and outlasting the state's auto and manufacturing sectors.

Sensing Michigan's misfortune, recruiters from Wyoming — some 1,000 miles to the west — have held job fairs in the state and lured away hundreds of workers from Flint, Saginaw, Lansing and the Detroit area. The first trip came in January 2006; recruiters plan to visit again in April or May.

"It's been a good fit," says Ruth Benson, executive director of Wyoming's Campbell County Economic Development Corp., noting similarities between the two states' weather and work ethics. "We're kind of down-to-earth, blue-collar people, too."

Russ Cline, 42, is among those who have left for Wyoming. He figured he would be better off taking a buyout from his Ford factory job in southeast Michigan than risking a layoff down the road and made the move west in January. His apartment and some technical training is paid for by his new employer, Powder River Coal Co. of Gillette.

Cline's wife, Michele, and their four children will remain in Waterford northwest of Detroit until the school year ends. But Cline says their long-term future is more secure in Wyoming, which can't find enough workers for its coal, oil and natural gas industries.

"I don't see it getting any better for another 6 or 8 years" in Michigan, he says. "Not until they diversify the economy."

Things could get worse before they get better, with layoffs planned by several major employers.

Chrysler Group, part of the Germany-based DaimlerChrysler, announced in February it plans to cut 5,300 auto-related jobs in southeast Michigan by 2009.

Pfizer Inc. announced in January it planned to cut about 2,410 pharmaceutical jobs in Ann Arbor, Kalamazoo and suburban Detroit by the end of 2008. GM, Ford and Delphi Corp. are cutting tens of thousands of jobs through buyouts.

Image: Richard Bigford of Shephard, Mich.
Carlos Osorio  /  AP
Richard Bigford of Shephard, Mich., looks over class notes at the M-TEC center at Mid Michigan Community College in Harrison, Mich. Enrollment at Michigan's 28 community colleges has increased about 19 percent in the past five years.

"If the auto industry is in trouble, particularly the Big Three automakers, then Michigan is in trouble. And of course, that's the case," University of Michigan economist George Fulton recently told state lawmakers.

Still, some workers are making the transition to new jobs in Michigan. Joe Main, 38, was among the 2,800 workers who lost their jobs when Sweden-based Electrolux AB closed its Greenville refrigerator factory last year, shipping the work to Mexico.

Main was laid off in November 2005, and began training to become an electrician at Mid Michigan Community College. The state has opened several similar technical education centers in the past few years, retooling workers for higher-demand jobs.

Now, Main has a solid job prospect at nearly $20 an hour with a Grand Rapids company.

"It's one of those fields I figure will be around for a long time," says the Riverdale resident, checking the circuits on a small motor he wired during a recent class. "It's not like they're gonna send this work out to Mexico."

Margaret Doyle, 37, worked for a tool-and-die company supplying the auto industry for nine years and for an auto parts maker for three years. The Farwell resident was used to cyclical layoffs. But when Doyle was laid off last summer, she switched gears and enrolled in a six-week course to become a nurse's aide.

"I knew the job availabilities were there," says Doyle, attending to patients at a Farwell nursing home as part of her job training. "I'm a single mom with three kids. I need to work."

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