We keep hearing warnings of a recession coming. If it does happen, folks in Michigan may come out better than most. Let’s take a look at why.
Here are Five Fast Facts about Michigan’s ability to weather an economic storm:
- 😱 Recession Incoming - Most economists think that a recession is coming later this year. Economic growth is slowing down and the feds keep hiking interest rates. You can feel the storm clouds gathering, can’t you?
- 📉 Michigan In Particular - Unfortunately, our state economy is slowing, too. It grew by 1.8% last year, but that was lower than the national average of 2.1%. Manufacturing is already struggling with higher costs, especially as people are buying less stuff since they can’t afford it now. Historically, Michigan takes a big hit when there’s a recession. This sounds terrible! Wasn’t there some good news in here somewhere??
- 👍 Some Good News - It seems the auto industry is in good shape to outperform the rest of manufacturing for a couple reasons. Consumer demand for cars is strong (supply chain issues are pretty much done) and parts orders are also up. Now if we could just get the cost of those cars down a bit…
- 👍👍 More Good News - If that wasn’t enough, the first quarter of this year saw strong car sales, and car production has picked up a bit to provide more inventory for all those buyers. Still, it’s a good time to be a car salesman, isn’t it?
- 🤷 Sometimes Irony Helps - One economist suggests another bit of ironic good news: the auto industry is a smaller part of the state’s economy now than it has been in the past. This is actually good when it comes to a recession because economic problems that affect the auto industry will hit the state less hard. It’s kinda' like being attacked by stormtroopers - sure, it’s scary and intimidating, but with their aim they’re likely to miss you!
🔥Bottom line: No one wants a recession, and it’s going to cause problems for everyone no matter what. But if our local industries can help insulate us from the worst of those problems, that’s a super good thing for us and our Paychecks!
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