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Manufacturing industry growing in Michigan, study shows

Courtesy of Kyle Swanson
University President Mary Sue Coleman answers questions about the University Research Corridor and the North Campus Research Complex after a press conference on Wednesday. Buy this photo

BY JOSEPH LICHTERMAN
Daily Staff Reporter
Published July 21, 2010

A report released Wednesday shows that despite Michigan’s sluggish economy, the high-tech advanced manufacturing sector throughout the state is thriving.

The report, which was commissioned by the University Research Corridor — a three-year-old research collaboration between the University of Michigan, Michigan State University and Wayne State University— showed that manufacturing, long thought to be solely comprised of the auto industry and similar manufacturers, is in fact a diverse and highly technical industry that is flourishing.

Patrick Anderson, principal and CEO of Anderson Economic Group — the East Lansing-based group that prepared the report — said the report defined advanced manufacturing “very specifically.”

“We talked about manufacturing sectors where productivity grew faster than manufacturing across the country,” Anderson said at a press conference Wednesday at the North Campus Research Complex in Ann Arbor. “Where productivity was significantly higher than what it was in the rest of manufacturing across the country. Where we were manufacturing specific high tech products and where we were inventing the processes with which manufacturers would use to make other products. This is not all the classic manufacturing.”

The report is the third study commissioned by the URC to observe different sectors of Michigan’s economy and how the URC impacts them. Previously, the annual reports had covered the state’s alternative energy and life sciences industries.

University of Michigan President Mary Sue Coleman, Michigan State University President Lou Anna K. Simon and Wayne State University President Jay Noren each spoke emphatically about how critical advanced manufacturing is for Michigan.

"Manufacturing continues to play a very important role in the state's economy, but it's not your grandfather's manufacturing," Simon said at the press conference. "Universities are helping to shape the high-tech, high-wage future of manufacturing in Michigan through our research, our education, our commitment to tech transfer and our industry partnerships."

Currently, according to the report, there are nearly 400,000 Michigan residents working for about 11,000 companies in the advanced manufacturing field across the state. Additionally, data from 2003 to 2007, which was the most recent data available, shows that the industry is growing.

The data published in the report reveals that over the course of those five years, while the rest of Michigan’s economy was contracting, the advanced manufacturing sector was growing rapidly.

During that five-year period average wages in advanced manufacturing grew 12 percent. Comparatively, wages in other industries grew 10.5 percent — an increase that, because it was less than the rate of inflation, saw a decline in real income values.

“The average wage in advanced manufacturing (was) $64,000 in 2007, compared to $41,000 in all other industries,” Anderson said at the press conference. “You cannot pay those high wages without high skill, high productivity or people buying your product. This is where you want to be if you want a high wage future in Michigan.”

Anderson added that the report illustrates how Michigan is a leader in the advanced manufacturing field as more than one third of all advanced manufacturing research jobs are located in the state.

“It’s not esoteric,” he said. “It’s not in little small places. It’s everywhere throughout Michigan. It’s ten percent of the employment in Michigan. 65 percent of all manufacturing in Michigan now is advanced manufacturing.

To help facilitate growth in the advanced manufacturing sector, the URC universities have collectively spent millions of dollars on research in the field. In fiscal year 2009, the three universities spent $101.9 million on advanced manufacturing research and development.

“The future of manufacturing can be found here,” Coleman said.


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