Economy of metropolitan Detroit

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The economy of metropolitan Detroit, Michigan is a key pillar of the economy of the United States. Its nine county area has a population of 5.4 million, a workforce of 2.8 million, and about 240,000 businesses.^[1] About 80,000 people work in downtown Detroit.^[2] Metro Detroit has propelled Michigan's national ranking in emerging technology fields such as life sciences, information technology, and advanced manufacturing; Michigan ranks fourth nationally in high tech employment with 568,000 high tech workers, which includes 70,000 in the automotive industry.^[3] Michigan typically ranks second or third in overall Research & Development (R&D) expenditures in the United States.^[4][5] Metro Detroit is an important source of engineering job opportunities. The domestic auto industry, primarily headquartered in metro Detroit, accounts directly and indirectly for one of every ten jobs in the United States.^[6]

Economic issues include the City of Detroit's unemployment rate which was 14.2% at the end of 2005, leaving the city with more than one-third of residents below the poverty line.^[7] The city's unemployment is in large part due to white flight to the suburbs following court ordered busing in the 1970s which impacted the city's tax base. An extensive freeway system constructed during the 1950s and 1960s facilitates commuting. The suburbs tend to have low unemployment; however, the economic cycles of the auto industry affect the metropolitan area.

The region has robust shopping malls and tourism which are a driving force for the economy. The region hosts large crowds from sporting events to the North American International Auto Show. The City of Detroit has three major casino hotels (2008), MGM Grand Detroit, MotorCity Casino, and Greektown Casino.

Contents 1 Economic growth 1.1 Cool Cities Initiative 1.2 Investment potential 2 Communication and media 3 Issues and problems 4 Historic highlights 5 Education 6 Transportation 7 See also 8 Notes 9 References 10 External links

[edit] Economic growth

Infrastructure is an important component in the metro Detroit economy. Detroit has an extensive freeway system which, together with its status as a major port facility, makes it an ideal location for a global business center. One of the nation's largest law firms, Miller, Canfield, Paddock and Stone P.L.C., has offices in both Windsor and Detroit. A 2004 Border Transportation Partnership study showed that 150,000 jobs in the Windsor-Detroit region and $13 billion in annual production depend on Detroit's international border crossing.^[8] The University of Michigan in Ann Arbor is one of the world's leading research institutions and Wayne State University in Detroit has the largest single-campus medical school in the U.S.

As the world's traditional automotive center, metro Detroit is headquarters to America's "Big Three" automakers, General Motors, Ford Motor Company, DaimlerChrysler's American headquarters, and a fourth, Volkswagen of America. In spite of foreign competition for market share, Detroit's automakers have continued to gain volume from previous decades with the expansion of the American and global automotive markets. General Motor's global sales have soared to 9.17 million vehicles. The sales revenue from just one of Detroit's automakers exceeds the combined total for the all of the top companies in many major U.S. cities. On quality, Cadillac outscored Lexus in two of three quality surveys by AutoPacific, Strategic Vision, and J.D. Power in 2003.^[9] General Motors continues to lead all other automakers in Strategic Vision's Total Quality Index (TQI).^[10] In 2006, Ford announced a dramatic increase in production of its hybrid gas-electric models,^[11] Ford and GM have also promoted E-85 ethanol capable flexible-fuel vehicles as a viable alternative to gasoline. General Motors has invested heavily in all fuel cell equipped vehicles,^[12] while Chrysler is focusing much of its research and development into biodiesel.^[13] Two days after the September 11, 2001 attacks, GM announced it had developed the world's most powerful fuel cell stack capable of powering large commercial vehicles.^[14] In 2002, the state of Michigan established NextEnergy, a non-profit corporation whose purpose is to enable commercialization of various energy technologies, especially hydrogen fuel cells. Its main complex is located north of Wayne State University.

United States Army Tank-Automotive and Armaments Command, known as TACOM is headquarted in metro Detroit together with Selfridge Air National Guard Base. Detroit Metropolitan Airport (DTW) is one of America's largest and most recently modernized facilities, with six major runways, Boeing 747 maintenance facilities, and an attached Westin Hotel and Conference Center. The region has important defense contractors such as General Dynamics.

In 2004, metro Detroit's economy made Michigan rank second nationally in new corporate facilities and expansions. From 1997 to 2004, Michigan was the only state to top the 10,000 mark for the number of major new developments.^[15] An indicator of economic strength, metro Detroit has one of the nation's largest office markets with 147,000,000 square feet (13,657,000 m²).^[16] Major office complexes include the 5,500,000 sq. ft. (511,000 m²) Renaissance Center, the 2,200,000 sq. ft. (204,000 m²) Southfield Town Center, and Cadillac Place with the Fisher Building in the historic New Center area. Downtown, the historic Penobscot Building is equipped with state of the art technology in the heart of the city's wireless internet zone. Metro Detroit's resilience has kept Michigan's economy growing inspite of difficulties.

Metro Detroit ranks among the nations top five financial districts having all of the big eight accounting firms.^[17] The areas major finanical service employers include Quicken Loans, GMAC, National City Corp., Fifth Third Bank, Comerica, Deloitte Touche, Ernst & Young, and Raymond James. Among the metro area's leading Information technology and computer software companies with a major presence or headquarters are Compuware, Electronic Data Systems (EDS), IBM, Google, and Covansys. EDS makes metro Detroit its regional headquarters, and one of its largest global employment locations. DaimlerChrysler's largest corporate facility is its U.S. headquarters and technology center in the Detroit suburb of Auburn Hills. Metro Detroit is the headquarters for Pulte Homes, one of the nation's largest home builders, and Taubman Centers, one of the nation's largest shopping mall developers. Kelly Services is another large employer headquartered in metro Detroit. Five of the world's twenty largest employers began in metro Detroit.^[18]

Tourism in metropolitan Detroit is a driving force for its economy. About 16 to 18 million people visit the area annually spending an estimated $5 billion demonstrating the viability of the region to provide substantial economic returns on investment, a factor lacking in some Olympic host cities.^[19] The region's leading attraction is The Henry Ford, America's largest indoor-outdoor museum complex.^[20][21] The region routinely hosts supersized crowds for such large events as the Windsor-Detroit International Freedom Festival, the North American International Auto Show, and the Motown Winter Blast on Campus Martius Park. The area has hosted several major sporting events such as Super Bowl XL. Detroit is the largest city to offer casino gaming. Major casino hotels include MGM Grand Detroit, MotorCity Casino, Greektown Casino, and Casino Windsor, the largest in Canada. The area's 24,000 acre network of "metro parks" receives about 9 million visitors annually.^[22] Over 6 million people live in the Windsor-Detroit region, making it unofficially one of the largest metropolitan areas in North America. Detroit is the nation's busiest international border crossing. An estimated 46 million people live within a 300 mile (480 km) radius of metro Detroit.

[edit] Cool Cities Initiative

The Cool Cities Initiative is an innovative reinvestment strategy for America's northern cities begun by Michigan leaders to rebuild inner cities and downtowns.^[23] Metro Detroit suburbs rank among the wealthiest in the nation.^[24] However, economic development of downtown Detroit is a priority for the region. OnStar, GMAC, and Compuware are sources of economic growth for downtown Detroit. The city reported $1.3 billion in restorations and new developments for 2006.^[25] Moreover, downtown Detroit has seen billions of dollars in new investment over the past decade. The Detroit Riverfront conservancy has been able to acquire the $500 million investment for Detroit International Riverfront development through a series of public and private grants which includes a three mile parkway along the east river from the Hart Plaza and the Renaissance Center to the Belle Isle Bridge.^[26] Eventually, the city plans a two mile extension to the Ambassador Bridge for the west river development. Lifestyles for rising professionals in Detroit reflect those of other major cities. This dynamic is luring many younger professionals to the downtown area.^[27] The 365 acre river east development is a plan investing billions of dollars in a new mixed use residential, commercial, and retail space for downtown Detroit to serve the people where they work and live. To spearhead the development, the State of Michigan created the Tri-Centennial State Park and Harbor downtown. The city's vibrant Midtown and New Center areas anchored by Wayne State University with 50,000 residents already attract millions of visitors each year to its museums and cultural centers; for example, the Detroit Festival of the Arts in Midtown draws about 350,000 people.^[28]

Speculative development for the city includes a new Quicken Loans headquarters downtown.^[29] Redevelopment of the Fort Shelby Hotel and the Westin Book-Cadillac Hotel has spurred economic growth downtown. However, the city has yet to develop the historic Michigan Central Station. The Southeast Michigan Council of Governments (SEMCOG) is studying the feasibility of light rail or other rapid transit linking Arbor to Detroit.^[30][31] These plans may become key to the region's prospective bid for the 2020 Olympic Games.

[edit] Investment potential

Metro Detroit is diversifying its economic base though initiatives in emerging technologies. The region's highly educated and innovative workforce is a comparative advantage which has been very successful in organic business growth with notable examples such as Compuware and Covansys. Metro Detroit's automakers are implementing their respective turnaround plans which present the prospects for renewed prosperity for the region. OnStar and GMAC are a source for growth. In 2002, the state constructed the NextEnergy Center just north of Wayne State University to focus on fuel cell development and alternative energy.

Detroit Metropolitan Airport is one of the nation's most recently modernized and expanded facilities with a Westin Hotel and conference center. One economic development strategy proposed is an Aerotropolis, a concept utilizing Detroit Metropolitan Airport as a central business district.^[32] The Southeastern Michigan Council of Governments (SEMCOG) has conducted a feasibility study for a light rail link from downtown Detroit to the Detroit Metropolitan Airport in its plans to expand the transportation network of the metropolitan area.^[33]

Metro Detroit has many opportunites for growth in tourism with great potential for development and expansion. An estimated 46 million people live within a 300 mile radius of the area. The region's abundance of natural lakes and coastal landscape present investment potential for beachfront resorts and luxury high rise condominiums. The inner suburbs have properties such as older malls which, if redeveloped, could become a new source for growth. As another comparative advantage, metro Detroit is home to highly successful realestate developers. Among these are Taubman Centers, Pulte Homes, and Victor International. Detroit has the potential to expand its role as an entertainment hub for the entire region. Major casino hotels are emerging in downtown Detroit which pose development prospects for new retail. The development of Detroit's west river area and its Michigan Central Station are the next frontiers for downtown. The Ambassador Bridge enhancement project calls for a twin span to be built across the Detroit River presenting the prospect for expanding the nation's busiest commercial border crossing.^[34]

[edit] Communication and media

See also: Media in metropolitan Detroit

• As the traditional automotive center, the region is a major source for journalism and news. The Detroit television market is the 11th largest in the United States;^[35] however, these estimates do not include large areas of Ontario, Canada (Windsor and its surrounding area on broadcast and cable, as well as several other cable markets in Ontario, such as the city of Ottawa) which receive and watch Detroit television stations, so the actual audience ranking may be higher. Discover Detroit TV which airs every Monday at 5:30 on Detroit's PBS affiliate is sponsored by the Detroit Metro Convention & Visitors Bureau. Detroit has the ninth largest radio market in the United States,^[36] though this ranking does not take into account Canadian audiences.

[edit] Issues and problems

See also: Crime in Detroit

• In February 2006, metropolitan Detroit's unemployment rate was 8.6% due primarily to high unemployment in the City of Detroit.^[37] In the City Detroit, the unemployment rate was about 14.2% at the end of 2005, leaving about one-third of Detroit's residents below the poverty line.^[38]
• Comerica Bank which, in an effort to further expand, announced it would move its corporate headquarters to Dallas, Texas in 2007, but maintain its presence in Michigan. The bank has engaged in a succession of takeovers in other states including Texas, Florida, and California. The bank's lease on Comerica Tower at Detroit Center runs through 2012.^[39]

• The city has yet to put forward a plan to renovate Michigan Central Station.
• The city and the counties have yet to come to an agreement on the expansion or replacement of Cobo Hall which hosts the North American International Auto Show.

[edit] Historic highlights

See also: History of Detroit

• President Franklin Roosevelt referred to Detroit as the "Arsenal of Democracy." The Ford Motor Company played a pivotal role in the allied victory during World War I and World War II.^[40] With Europe under siege, Henry Ford's genius would be turned to mass production for the war effort. Specifically, the B-24 Liberator bomber, still the most produced allied bomber in history, quickly shifted the balance of power. The aviation industry could produce, if everything went alright, one Consolidated Aircraft B-24 Bomber a day at an aircraft plant. Ford would show the world how to produce one B-24 an hour at a peak of 600 per month in 24 hour shifts. Ford's Willow Run factory broke ground in the April of 1941. At the time, it was the largest assembly line in the world, with over 3,500,000 square feet (330,000 m²). Edsel Ford, Henry Ford's son, under severe stress of running the B-24 bomber facility, died in the Spring of 1943 of stomach cancer prompting Henry Ford to re-assume day-to-day control of the Ford Motor Company. Mass production of the B-24 began by August of 1943. Many pilots slept on cots waiting for takeoff as the B-24 rolled off the assembly line at Ford's Willow Run facility.^[41]

[edit] Education

• Cranbrook Educational Community
• Lawrence Technological University
• Oakland University
• University of Detroit Mercy
• University of Michigan
• Wayne State University

[edit] Transportation

• Bishop International Airport in Flint
• Coleman A. Young International Airport
• Detroit (Amtrak station)
• Detroit Department of Transportation (DDOT)
• Detroit Metropolitan Airport (DTW)
• Detroit People Mover
• Michigan Department of Transportation (MDOT)
• Suburban Mobility Authority for Regional Transportation (SMART)

[edit] See also

• List of companies based in Michigan

[edit] Notes

[edit] References

• Bak, Richard (2001). Detroit Across Three Centuries. Thompson Gale. ISBN 1585360015. 
• Ballard, Charles L. (2006). Michigan's Economic Future: Challenges and Opportunities. Michigan State University Press. ISBN 0870137964. 
• Fisher, Dale (2003). Building Michigan: A Tribute to Michigan's Construction Industry. Grass Lake, MI: Eyry of the Eagle Publishing. ISBN 1891143247. 
• Fisher, Dale (2005). Southeast Michigan: Horizons of Growth. Grass Lake, MI: Eyry of the Eagle Publishing. ISBN 1891143255. 
• Fisher, Dale (1994). Detroit: Visions of the Eagle. Grass Lake, MI: Eyry of the Eagle Publishing. ISBN 0-9615623-3-1. 
• Gavrilovich, Peter and Bill McGraw (2000). The Detroit Almanac. Detroit Free Press. ISBN 0937247341. 
• Poremba, David Lee (2003). Detroit: A Motor City History. Arcadia Publishing. ISBN 0-7385-2435-2. 
• Poremba, David Lee (2001). Detroit in Its World Setting (timeline). Wayne State University. ISBN 0-8143-2870-9. 
• Smith, Michael and Tom Featherstone (2001). Labor in Detroit (Images of America). Arcadia Publishing. ISBN 0738518964. 
• Woodford, Arthur M. (2001). This is Detroit 1701-2001. Wayne State University Press. ISBN 0-8143-2914-4. 

[edit] External links

• Aerialpics.com
• Cityscape Detroit
• Cool Cities Initiative
• Detroit Metro Convention & Visitors Bureau
• Detroit Economic Club
• Detroit Economic Growth Corporation
• Detroit Regional Chamber of Commerce
• Detroit Rising
• Detroit Riverfront Conservancy
• Detroit Renaissance
• Detroit travel guide from Wikitravel
• Experience Detroit
• Guide2Detroit
• Model D Media
• New Center Council
• NextEnergy
• Tourism Economic Development Council of Detroit - TEDC
• The world is coming, see the change

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