By: Ted Dabrowski and John Klingner
Working-class Michiganders have a reason to celebrate. Lower taxes, right-to-work reforms and a successful diversification away from the auto industry have led to more manufacturing jobs today than the state had before the Great Recession.
Michigan has had the most successful recovery among the manufacturing states in the Midwest.
In contrast, Illinois has had the worst recovery. Higher taxes, onerous labor laws and a rejection of the deregulation wave mean Illinois still hasn’t gotten back to the number of manufacturing jobs it had before the recession. Over 88,000 jobs are still missing.
In fact, Michigan’s recovery has been so great, and Illinois’ so poor, that Michigan now has more manufacturing jobs than Illinois.
In 2007, Illinois had 70,000 more manufacturing jobs than Michigan did, according to the U.S. Bureau of Labor Statistics. Today, Michigan has 40,000 more.
Recovery vs. stagnation
Only two of the manufacturing states in the Midwest have recovered the manufacturing job losses caused by the Great Recession. Michigan has added nearly 25,000 jobs when compared to 2007, while Iowa just squeaked into positive territory with 900 more jobs.
For the rest of the states, though, the numbers are all negative. Indiana is still down 11,000 manufacturing jobs, or 2 percent, from where they were in 2007. Wisconsin is down 26,000, or 5.1 percent.
And Illinois is at the back with 88,000 missing jobs – down 13 percent compared to 2007.
Illinois’ anti-business atmosphere likely has a great deal to do with its poor manufacturing recovery. Illinois has restrictive labor rules compared to its neighbors and many states across the country. And companies have to deal with one of the highest tax burdens in the country, including the nation’s highest property taxes.
Illinois lawmakers have done little to reform any of that since the Great Recession. And some things, like the tax burden, have only gotten worse.
According to James Hohman from the Mackinac Center, “one out of 15 jobs in the state was in auto manufacturing in 2000. Now it’s just one out of 25 jobs.” That’s a big deal considering that from 2009 to 2016, manufacturing accounted for one of every three new Michigan jobs.
Michigan should continue what it’s doing to generate more jobs for the working class. Meanwhile, Illinois should take a page out of Michigan’s playbook.