UM report: Oakland County's economy won't fully recover until 2023
Pontiac — University of Michigan economists predicted Wednesday that aspects of Oakland County’s economy should rebound faster than the rest of the state following the COVID-19 pandemic, but a full recovery will take a couple of years.
Donald Grimes and Gabriel Ehrlich presented the 36th Annual UM Economic Forecast, which expects Oakland County to return to its pre-pandemic employment level by early 2023 and the state to do so later that year. Grimes said the county — one of the most populated and prosperous in Michigan — should see the number of jobs grow 4.1% this year; 4.6% next year and 2.5% in 2023, where county unemployment is expected to be well below 3%, near the record low of 1999.
“Oakland County is well on the path toward the recovery from the pandemic induced recession,” said Grimes, during the presentation from the Oakland County Executive Office Building. “The county’s unemployment rate is already near record low levels, although it is partly a reflection of people leaving the labor force during the pandemic.
“If people don’t rejoin the labor force as we expect, finding new workers to hire will become even harder than we currently expect.”
Ehrlich, director of UM’s Research Center in Quantitative Economics, said the environment “is favorable for Oakland County’s economy to make a strong economic comeback, led by production and professional industries that tend to pay higher wages. The major cloud on the horizon is that we expect the recovery in lower-wage jobs to be slow, with lower education service industries not making a full recovery in our forecast.”
Driving Oakland County’s comeback is a highly-educated labor force and reducing unemployment numbers, the economists said. Oakland’s unemployment rate peaked at 19.6% in May 2020 but fell to 8.1% by July as the economy began to reopen. Unemployment wavered between 7.8% and 8.3% from July to November 2020 and increased to 9% in December as the second wave of the COVID-19 virus picked up.
Oakland’s unemployment rate dropped to 4.7% this past January and has continued to decline. It stood at 3.1% in March.
“Oakland County’s economy is critical to the state and 20% of the state’s GDP and 17% of the state payroll,” said Grimes.
Grimes cautioned that any recovery is dependent on many factors, notably reducing COVID-19 numbers.