Detroit is one of just 56 out of 300 metropolitan regions across the globe tagged as “pockets of growth” from the worldwide recession, powered partly by strong job growth in the auto manufacturing sector.
The ranking comes from the third edition of the Global MetroMonitor from the Brookings Institution, which measures economic and job growth in metropolitan regions around the world. The study found that in the U.S. only three of 76 metro areas have fully recovered from the Great Recession this year — Dallas, Knoxville, and Pittsburgh — while 20 areas declined.
Detroit and five others — six U.S. metro areas — Boston, Salt Lake City, San Jose, Seattle, and Worcester — were among the 56 metro economies that are growing faster than their home country but which haven’t completely made up the losses from the worst economic downturn since the Great Depression.
“We tend to think of national or regional or, in the U.S., state divides,” said Emilia Istrate, an associate fellow at Brookings. “But the reality is that the global economy and the national economy are metro-driven economies. That’s how the economy works and how business works. Businesses don’t care about administrative jurisdictions at the end of the day.”
The 300 metro areas measured accounted for nearly half of the global economy this year, but more than half of the growth since 2011, even though those regions contain just 19 percent of the world’s population, Istrate explained.
Detroit’s bounce-back is largely fueled by manufacturing, the study found. Although the sector represents only about 11 percent of Metro Detroit’s overall jobs, it delivered more than a third of all new jobs created here between 2011 and 2012. “Manufacturing punched above its weight in Detroit this year,” Istrate said.
Specifically, economic growth in Metro Detroit (which measures improvement in the standard of living and is expressed in per capital real GDP) was 1.8 percent between 2011 and 2012, based on estimates for the rest of this year. Employment growth was 1.7 percent. Nationally, the U.S. per-capita GDP was just slightly worse, and employment growth was 1.4percent.
The findings from the Brookings Institution mirror the recent analysis from the University of Michigan, which found jobs statewide grew by 1.3 percent this year and income was up by 3.8 percent.
This was the second year in a row that Metro Detroit has shown good growth in the Brookings study, partly because the region fell so hard during the recession. But the area has overcome some of the damage. “Detroit is growing faster than other metro areas that were hit really hard, such as Las Vegas, so it’s not all because Detroit lost a lot in the recession,” Istrate said.
The rate of growth has been slowing, though, and Detroit still isn’t back to where it was or even to where much of the country stands. This year, Detroit’s per-capita GDP is only 80 percent of the national per-capita GDP.
Detroit still has a way to go,” Istrate said. “These rates are decent but unfortunately, growth in Detroit has decelerated from last year. In a way, Detroit has been caught in the global slowdown this year, but it’s good that it’s growing and it’s on the path to recovery.”
Brian J. O’Connor, The Detroit News