Oakland County will continue to thrive, say researchers
ANN ARBOR—After posting its largest employment gains in nearly a decade last year, Oakland County will add another 47,000 private-sector jobs in the next two years, according to a University of Michigan study.
In their annual forecast of the Oakland County economy, researchers George A. Fulton, Donald R. Grimes and Peter Nicolas of the U-M Institute of Labor and Industrial Relations say that job growth in the county will continue to outpace the state.
“The Oakland County economy will slow from its record pace of 1994, as the effect of higher interest rates takes hold in the national and local economies during 1995,” the researchers say.
They predict that total private-sector employment in Oakland County will grow by about 4 percent in both 1995 and 1996, noting that last year’s growth rate of 5.5 percent is not sustainable over long periods of time.
Fulton, Grimes and Nicolas attribute last year’s remarkable growth rate to the creation of some 9,000 manufacturing jobs” the most since 1985″ thanks mostly to a strong rebound in automobile sales and a boom in capital investment that spurred rapid growth in the industrial machinery and equipment industry.
The researchers predict that 4,000 manufacturing jobs will be added in 1995 and 1996, resulting in the highest employment levels ever for that sector in Oakland County.
“Of these jobs, nearly 1,000 will be added in the industrial machinery industry because of continued strong investment in capital equipment,” they say. ” There also will be a net gain of 1,000 jobs in the motor-vehicle manufacturing industry, but they will be management-level positions, not production jobs. ”
A reduction in blue-collar jobs, they add, is more than offset by an increase in white-collar employment at Chrysler corporate headquarters and engineering jobs at General Motors.
According to the report, growth in non-manufacturing industries in Oakland County will account for most job gains through the end of 1996, with about 90 percent (43,000 jobs) of new employment occurring in service industries, retail trade, wholesale trade and finance.
Service industries will post gains of 28,000 jobs, of which 22,000 will be in business and professional services and 3,000 will be in health services, the researchers say.
In addition to service, retail trade will gain 6,000 jobs in the next two years, with two-thirds projected for 1996, they say.
“The large job gains in 1996 reflect the scheduled opening of Somerset Collection North,” Fulton, Grimes and Nicolas say. ” With the combination of the county’s strong projected economic growth and its low unemployment rate, it is possible that these stores will have difficulty finding all the workers they need. ”
Other non-manufacturing industries, such as wholesale trade (5,000 new jobs) and finance (3,000 new jobs) will continue to grow, but jobs in construction will remain constant due to adverse effects of higher interest rates, the researchers add.
Overall, the researchers predict that manufacturing jobs will increase 3.1 percent in 1995 and 0.5 percent in 1996, down from a ” torrid” 8.7 percent in 1994. They expect the growth rate for private non-manufacturing employment to slow from 4.8 percent in 1994 to 4.1 percent in 1995, before returning to 4.8 percent in 1996.
Despite a projected slow-down of job gains in Oakland County in the next two years, employment in the county is expected to grow more than twice as fast as the state through mid-1996, and nearly four times as fast during the second half of 1996, according to the researchers.
In fact, during the 1990s, Oakland County’s rate of 9.9 percent in private-sector job growth is the best among major local economies in Michigan, they say. Moreover, employment in the county has grown twice as fast as the state and nearly three times as fast as the nation since 1990.
In addition, the study shows that Oakland County’s 1992 per capita income of $28,671 is, by far, the highest in Michigan and among the top 1 percent in the nation.
Compared with 25 other large suburban counties in the United States, Oakland County ranked ninth in total private employment growth during 1979-1992.
The 10th annual U-M forecast of Oakland County’s economy was sponsored by 22 Oakland County organizations. Its presentation was hosted by the county’s Development and Planning Division; NBD Bank; and Oakland Community College.