The Detroit Regional Chamber’s 2025 State of the Region report marks our 11th year of presenting a review and forecast of how the Detroit Region fares compared to national peers, national averages, and year-over-year performance.
For the Chamber team, 2025 presented unusual challenges. Perhaps no time in recent history – at least since the advent of compact disc player – has Michigan seen such an uncertain national policy environment. The State of the Region report does its level best to use factual and official data to report on past performance – and to use our own thought analysis to put into perspective what might come. This year is more difficult than most due to the rapidly changing national policy environment that positions Michigan on the front line of potential changes – for good, or for otherwise.
The Chamber serves as the “keepers of the regional data,” and we are pleased to present the 2025 State of the Region.
Regional economic resilience continued in 2024.
The Region’s economic momentum continued in 2024 with low unemployment, increased new business applications, and exports reaching a five-year high. Michigan now holds the national top ranking for business-funded R&D and nextgeneration mobility investments, and is attracting increasing venture capital investments. All of these elements have fueled our economic resilience.
Lagging our peers remains a challenge.
Despite the Region’s growth trajectory, we trail the national average as well as our national regional competition. Our Region ranks in the bottom third in educational attainment, GDP growth, population, and employment growth – all of which tie directly to the ability to grow and retain high-tech talent.
As you review this report, I hope you take away the three things. First, our people and businesses – have done well; second, we have work to do to meet our national peers; and third, Michigan is at a disproportionate risk of the policy changes contemplated at the federal level.
Sandy K. Baruah President and Chief Executive Officer, Detroit Regional Chamber
Citizens is thrilled to once again partner with the Detroit Regional Chamber to produce this data-rich State of the Region report.
This year’s report demonstrates continued strength in the Greater Detroit economy through 2024. The labor market remained solid and robust consumer spending continued to fuel GDP growth.
The business environment in both the Detroit Region and the state continues to be prosperous. Michigan’s new business applications in 2024 were 28% higher than 2019 levels. Michigan also remains an engine for innovation, holding the #1 rank for business-funded R&D and next-generation mobility investments among states.
There are challenges and areas for improvement. The near-term environment remains uncertain as businesses navigate changing federal policies. Inflation also remains a concern, and the Detroit Region lags its peers in metrics like educational attainment and growth in population and jobs.
However, at Citizens, we believe we are uniquely positioned to convene industry and community leaders to address these challenges. That’s why we are proud to partner with the Detroit Regional Chamber and other organizations like the Great Lakes Women’s Business Council, Accounting Aid Society, Greening of Detroit, and Junior Achievement to support workforce development and financial empowerment programming.
Despite some uncertainty, there are plenty of reasons to be optimistic. Citizens is committed to serving as a trusted advisor to our clients and community partners here in the Detroit Region as we navigate changing circumstances and work together toward the continued prosperity of the Greater Detroit economy.
The overall economy has been strong. Inflation continues to decline from its 2022 peak, the labor market remained solid in 2024, and robust consumer spending fueled GDP growth. However, consumers are still concerned, with sentiment remaining below pre-COVID-19 pandemic levels and the Detroit Region continuing to fall behind on key indicators compared to its peers.
1. 2. 3. 4. 5.
Regional Economy Remains Resilient Through 2024
The Detroit Region Lags Peers in Most Key Metrics
Inflation Concerns Persist as Consumers Grapple With Higher Prices
The Region and the State Continue to Provide a
Prosperous Business Environment
Michigan’s Economy is Disproportionately Vulnerable to Fluctuating Trade Policy
Detroit Region’s unemployment remained below 5% for three consecutive years. Payroll employment is up by 5,500 from 2023.
The Region’s housing market is a bright spot ranking #1 among peers in homeownership and among the most affordable in the nation.
The Detroit Region ranks in the bottom third in educational attainment, GDP, population, and jobs.
The Detroit Region’s employment returned to 2019 levels while peers like Austin (21%), Dallas (13%), and Phoenix (13%) grew significantly.
Inflation concerns doubled for Michigan voters, increasing from 16% to 29% since September 2024.
Regional inflation fell to 3% in 2024, nearly reaching the Federal Reserve’s 2% target, after reaching a peak of 8% in 2022.
The average household in the Detroit Region lost $3,000 in purchasing power due to inflation in 2023.
Michigan ranks #1 for business-funded R&D and next-generation mobility investments among states.
Michigan’s new business applications are 28% higher in 2024 than 2019 levels.
The Region’s export market is at risk, despite growing 11% since 2019, reaching the highest levels seen in five years
Over 234,000 jobs in the Detroit Region depend on trade and investment with Canada.
Michigan’s manufacturingcentered economyespecially within the automotive sector - as well as its agriculture industry and proximity to trading partner Canada, leave it particularly vulnerable to the negative impacts of volatile trade policies.
PEER REGION COMPARISON
Detroit Region Contends With Strong Competition From Peers in Educational Attainment, GDP, Population, and Jobs
Peer region benchmarking is an important framework for prosperity, helping businesses, government, and stakeholders identify strengths and opportunities to make the Detroit Region an economically attractive and competitive place. The 19 peer regions selected for comparison reflect factors like population, the size of the economy, and regional industries and assets, as well as aspirational factors like educational attainment.
DEFINING THE REGION
While traditional manufacturing is a major part of Michigan’s economy, the shift to electrification and next-generation mobility will ensure the economy continues to prosper. Ford Motor Company is part of that, manufacturing the F-150 Lighting in the Detroit Region at the Rouge Electric Vehicle Center in Dearborn. Photo courtesy of Ford Motor Company.
TOP INDUSTRIES
Detroit Region’s Top Industries Fuel
► Of the 2 million people employed in the Detroit metro area, over 996,600, or 46%, are employed in the top four industries.
► The health care industry accounts for 14% of the Region’s employment.
Source: Lightcast
Michigan Central and New Lab
MOMENTUM IN THE REGION
University of Michigan Center for Innovation in Detroit Gratiot Innovation District Henry Ford Health and Michigan State University Health Sciences Research Center
Diverse regional investments are underway across projects in infrastructure, higher education, and private sector industries.
KEY ECONOMIC INDICATORS
REAL GDP
The Overall Economy Remains on a Solid Growth Trajectory
Detroit Region Economy Grew on Average at a Slower Pace Than the Nation and State
Compound Annual Real GDP Growth Rate, 2019-2023
The Economy Grew in 2024, Driven by Strong Consumer and Government Spending and Investments Quarterly Real GDP, Percent Change From Preceding Period
Perceptions about the economy are split among voters.
Employees placed by Michigan-based Crown Staffing Solutions at work in a warehouse facility.
Photo courtesy of Crown Staffing Solutions.
Detroit Ranks Bottom Third in GDP Growth
Real GDP Growth by Peer Regions, 2019-2023
► While Detroit Region’s economy has grown for three consecutive years, increasing 5% since 2019, it lags its peers regions and the nation (9%) in GDP growth.
► In 2023, the Detroit MSA reported a real GDP of $276 billion, ranking 16th largest economy among all U.S. metros
Austin 1
EMPLOYMENT
Resilient Economy Keeps Job Growth
and Relatively
► Although unemployment in the Detroit Region ticked up in 2024, it is still near record lows, staying below 5% for three consecutive years. However, there are signs of weakening as unemployment numbers started to trend up in the latter half of 2024 and into 2025.
Detroit Region’s Unemployment Increases Over the Years As Labor Market Conditions Soften
Annual Unemployment Rate, Not Seasonally Adjusted
Employment Recovered From Pandemic Losses, Increasing 11% Since 2020 and Hitting Levels Last Seen in 2005
Annual Total Nonfarm Employment, Detroit MSA
TALENT DEMAND
Workers Faced Fewer Opportunities as Job Postings Decline
Amid a Cooling Labor Market
Job Postings Reach 10-Year Low, Dropping 44% Since Peak in 2022
Annual Unique Job Postings, Detroit MSA
Job Postings per Unemployed Person
In 2024, there was one job opening for every unemployed person, indicating a tighter labor market compared to 2022, when there were double the job openings per unemployed person.
Job Postings Changes
Job postings have fallen across all peer regions, with Detroit experiencing one of the largest declines since 2019.
Job Postings by Industry
Job Postings by Occupation
Inflation Notably Lower Than Peak, Consumers Grappling With Higher Prices
Inflation Dips to 3% Regionally; Consumer Optimism About the Economy Remains Below Pre-pandemic Levels in 2024
WAGES AND INCOME
Detroit Region Households and Workers Have Less Purchasing Power Than Before the Pandemic
► Real weekly wages, a measure of income after accounting for the costs of goods and services, amounted to a 2.7% loss in buying power on average for employees in the Region in 2024.
► Inflation erased most gains for families as median household income, adjusted for inflation, was Nationally, household incomes decreased by 1% compared to 2019.
Wage Growth for Individuals in the Detroit Region Have Not Surpassed Inflation in 2024 Consumer Price Index: All Items in U.S. City Average, Real Average Weekly Earnings for All Employees: Total Private, 12-Month Percentage Change, Detroit MSA
A majority of peer regions showed median household incomes,
Household Income Gains Were Also Eroded by Inflation, Declining 4% Since 2019
HOUSING
HOMEOWNERSHIP
Homeownership and Relative Housing Affordability Are Two of Detroit Region’s Key Strengths, But It Is Not Immune to Challenges
► High mortgage rates and inflation have already impacted the housing market, and even with higher homeownership rates and generally affordable housing compared to the national average and peers, the Region's growing challenges in housing equity, affordability, and availability threaten businesses' ability to attract and retain a talent supply and the Region’s overall economic success.
How Interest Rate Hikes Affect Homebuyers’ Purchasing Power
Detroit: #1 Region for Homeownership
Homeownership Rate by Peer Regions, 2023
► The Detroit Region has the highest homeownership rate among the 19 peer regions, 7 percentage points higher than the national average of 65%.
► Disparities among racial and ethnic groups persist despite Black or African American households experiencing the largest increase (4.4 percentage points) in ownership year-over-year.
Homeownership by Race and Ethnicity
Detroit MSA, 2023
HOUSING TRENDS
Detroit Region’s Median Home Prices Are on the Rise
► Growth in average home prices has brought an increasing concern about housing affordability and availability. The housing challenges that the Region faces are complex, and the explosion of home values, high interest rates, and low supply continue to exacerbate the problem.
Home Prices Increased 8% Year-Over-Year, Surpassing the National Growth Rate of 5% Median Sale Price of Existing Single Family Homes, United States and Detroit MSA
Detroit Regional Chamber Michigan Voter Poll., February 2025
Building Permits Are Half of What They Were Total Building Permits Authorized, Not Seasonally Adjusted, Detroit MSA
► Building permits averaged almost 18,000 permits per year between 1988 and 2000, building significantly up until the financial crisis in 2008. With building levels not recovering in the past 10 years, permits averaged around 7,500 per year in the Region.
Cities, suburbs, and rural areas in Michigan are facing the same affordable housing crisis as the rest of the country, and it’s one driven by a lack of affordable options. Our state’s ongoing housing supply and affordability crisis deserves an all-hands-on-deck response. To even begin moving the needle on housing demand in this state, we need more of everything. We need more multi-family housing, we need more rental homes, more apartments, more condos, more duplexes, and more neighborhoods.
The Detroit Region is falling behind peers in authorizing building permits. Permits have decreased by 11% since 2019.
JOHN LINDLEY, PRESIDENT AND CHIEF EXECUTIVE OFFICER, MICHIGAN MANUFACTURED HOUSING ASSOCIATION
FORTUNE 500 AND LARGEST
► As the epicenter of the global automotive industry, Ford Motor Company and General Motors are among the top of the Fortune 500. While Stellantis is not included on the list, its North American headquarters in Auburn Hills, Michigan, employs almost 42,000 people in the Detroit Region and earned $203 billion in revenue in 2023.
Fortune 500 Companies by Peer Regions
REAL ESTATE
Vacancy Rates Rise in 2024, However Remain Below National Averages
► Detroit’s industrial market continues to experience tight market conditions, with a vacancy rate of 2.6 percentage points (4.2%) lower than the U.S. average of 6.8% in 2024.
► The Detroit Region’s office vacancy rate remained high in 2024, increasing 2.5 percentage points since 2019.
As office building vacancy rates have increased in recent years, many developers are rethinking how
spaces can be used. Rendering of a conceptual plan from Bedrock and General Motors for the redevelopment of the Renaissance Center site in Downtown Detroit. Photo courtesy of Bedrock and Gensler.
BUSINESS APPLICATIONS AND VENTURE CAPITAL
Michigan’s
Business Applications and Venture Capital Investments Remain Resilient
► High-propensity business applications, or those likely to create payroll jobs and contribute to job creation, saw a 28% increase since 2019. The high number of applications continued into 2024, demonstrating strong entrepreneurial activity despite persistent inflation and high interest rates.
Business Applications Remain Higher Than Pre-pandemic Levels in 2024
of Michigan’s venture capital investments occurred in the Detroit Region in 2023.
Michigan’s Venture Capital (VC) investment totaled over $1 billion in 2024 increasing 48% since 2019. Overall, Michigan’s VC activity has remained steady while overall national activity has slipped since a 2021 peak.
Michigan is
now
a place where [venture capitalists] who wouldn't previously look are willing to look
...
It gets easier each year to get funds from other parts of the country [and] to look at startups here because of [our] ... great technology, great engineering, and improving climate.
CHRIS
RIZIK,
MANAGING PARTNER, RENAISSANCE VENTURE
CAPITAL, AT THE 2025 DETROIT POLICY CONFERENCE
BUSINESS OUTLOOK
Encouraging
Economic conditions have been stable nationally and in the Detroit Region with low unemployment and positive job growth in 2024.
Michigan’s R&D tax credit passed in January 2025, which will stimulate investments in research and bolster economic growth while leveraging the state’s existing businesses and world-class research universities.
U.S. manufacturing showed signs of improvement going into 2025 after contracting over the past two years.
Regional investment projects, like those highlighted on page seven of this report, continue to move forward, highlighting the benefit of cross-sector collaboration and investment in innovation.
Challenging
Uncertainty has elevated as dramatic federal economic policies are discussed, including impacts from tariffs and potential federal funding cuts for infrastructure and university research.
Digital transformation through artificial intelligence will increase the need for businesses to adopt new technologies, increase productivity, and remain competitive.
Michigan’s automotive and mobility leadership faces significant pressures from emerging technology adoption, domestic and global competitors, and impacts on the supply chain, including tariff effects.
Michigan’s limited population growth was concentrated in international migration, while the state continues to lose population domestically to other states, adding uncertainty to growth going forward with potential immigration policy changes.
Leaders Navigating a Shifting Business Climate Heading into 2025
U.S.
CEO Outlook Has Fallen Sharply, Reaching Levels Last Seen in 2012
► Leaders express the unpredictability of federal policies, such as tariffs, geopolitical uncertainty, government layoffs, and immigration, will have a negative impact on business.
of chief executive officers forecast improving conditions over the next 12 months as of March, down from 52% since January 2025.
anticipate revenues to grow in 2025, down from 84% in January 2025.
U.S. Manufacturing Index Registered Above 50% for the First Time in Over Two Years, Indicating
or
The survey of purchasing managers for manufacturing indicated tariff concerns are driving decision-making.
Artificial Intelligence (AI) Recognized
by
Leaders as Transformational Business Imperative
of employers indicate AI is the technology trend driving business transformation over the next five years.
of employees will need reskilling or upskilling in AI by 2027.
of leaders expect to increase their overall AI spending in the next fiscal year.
AI is not likely to take your job but someone with AI skills will.
PETER QUIGLEY, PRESIDENT AND CHIEF EXECUTIVE OFFICER, KELLY
Region Sees Increase in Exports, But Tariff Hikes Could Hinder Growth
Exports Reach 5 Year Record High, Increasing 11% Since 2019
Tariffs could significantly impact businesses, workers, and consumers in Michigan, driving up costs and harming vital industries.
Canada is Michigan and the Detroit Region’s Major Trading Partner
As MichAuto has continued to advise, the tariffs’ harmful effects will extend beyond trade relationships and will cause businesses to purchase and produce fewer products, hire fewer employees, and increase prices to the detriment of consumers.
GLENN STEVENS JR., EXECUTIVE DIRECTOR, MICHAUTO AT THE DETROIT REGIONAL CHAMBER
43%
of Michigan imports come from Canada ($51B in 2023), second largest after Mexico at $69B.
Jobs Depend on Trade Relationships With Canada
234,000 OVER
6,930 30% of Michigan’s $65B in exports go to Canada.
jobs in the Detroit Region depend on trade and investment with Canada.
Trade Helps Support Detroit Region’s Small Businesses
companies in the Detroit Region export goods, with 88% being small and medium-sized businesses (under 500 employees).
Together, Canadians and Michiganders have built a cross-border economy that is the envy of the world. We need to collaborate now more than ever in the face of global threats. Now is not the time to build a tariff wall down the middle of the Great Lakes that separates Michigan from its most important export market and natural economic partner, Canada. Now is the time to strengthen North American supply chains.
COLIN BIRD, CONSUL GENERAL
MOBILITY
BY THE NUMBERS
#1 state
for vehicle production producing over 844,700 more vehicles in 2024 than the next highest state. Further, 19% of all U.S. auto production occurred in Michigan in 2024
97 of the 100
top automotive suppliers to North America have a presence in Michigan, with 58 headquartered here
#1
exporter
of transportation equipment in the U.S.
$348B
to Michigan’s economy through its mobility industry contributions, representing 27% of the state’s GDP.
#1 state
MichAuto is the only statewide association working to promote, retain, and grow Michigan’s automotive, mobility, and associated technology industries. MichAuto serves as an advocate for the entire automotive and mobility ecosystem across the state of Michigan. MichAuto is affiliated with the Detroit Regional Chamber, whose leadership team supports MichAuto with strategic counsel and resources to execute program work and effective operations while working towards complementary missions and values.
for business-funded automotive and mobility R&D in the nation, totaling 55% of the nation’s share with $17 billion in funding.
26 original equipment manufacturers (OEMs) located in Michigan.
1.2 million jobs tied to the industry, or 1 in 5 jobs in Michigan.
Brose operates a Mechatronics Apprenticeship Program in Michigan, training students in robotics, PLC programming, and other skills to grow the state and Detroit Region’s high-tech talent pipeline.
Photo courtesy of Brose.
EV LANDSCAPE
Michigan’s EV Landscape Has Been Incrementally Building
► Investments in charging infrastructure and battery facilities are underway and EV adoption has slowly increased over the decade. Michigan has been a leader in the industry’s evolution; as it continues to undergo a transition to EVs, it is vital for Michigan to remain at the forefront.
EDUCATION AND TALENT
Key Takeaways From the 2024 State of Education and Talent Report
1. Perception of college value has hit crisis levels.
2. The talent pipeline is drying up due to continued enrollment declines.
3. Employers’ talent shortage is likely to get much worse. Half
The Detroit Regional Chamber released its fifth annual State of Education and Talent report examining trends and outcomes related to the talent pipeline in the Detroit Region and what that means for employers’ needs. The Chamber recognizes the impact an educated workforce has on economic prosperity and competitiveness, and has created education and talent initiatives like TalentEd, Detroit Promise, and Detroit Reconnect.
Read this year’s key takeaways and explore the full issue on our website.
detroitchamber.com/talented
of Michigan voters think a college education is important to land a successful job.
37% of regional high school graduates do not opt to further their education after graduation.
of the adult population in the Detroit Region has a post-high school credential, but 70% of all Michigan jobs will require it by 2031.
Establishing a higher education culture will not be easy and will take more than one thing. Certainly, the quality of our existing K-12 system must be improved dramatically, and colleges must control their costs and ensure better success rates. But, establishing a “K – 12 + 2” approach can play a significant role in advancing this much-needed culture shift.
SANDY K. BARUAH, PRESIDENT AND CHIEF EXECUTIVE OFFICER, DETROIT REGIONAL CHAMBER
ON THE “K-12+2” SHIFT
DTE Day hosted by the Detroit Promise connected Detroit Promise students with DTE recruiters to learn about career opportunities.
EDUCATIONAL ATTAINMENT
Detroit Region Falls in the Bottom Half for Rate and Growth of Working Age-Adults With an Associate Degree or Higher
Gains Made in Educational Attainment, Increasing
3 Percentage Points Since 2019, But Region Lags
Peers and Nation Educational
ECONOMIC EQUITY AND INCLUSION
As the Detroit Regional Chamber and Detroit Region continue to navigate an ever-changing business landscape, it has become more crucial than ever for companies to embrace principles that are imperative for employee attraction and retention and to ensure their work best reflects and supports the communities they serve.
In 2023, the Detroit Regional Chamber, in collaboration with national data partner Gallup, released the Detroit Resident Voices Survey Report, highlighting Detroiters’ daily experiences and perceptions. The report is part of the Chamber’s Economic Equity and Inclusion initiative.
Data continues to prove the benefit of diversity, equity, and inclusion to business. It improves morale and productivity within workforces, it increases customer loyalty, and it grows markets for products and services. These aren’t buzzwords or trends, but rather, principles that when implemented thoughtfully, are a fruitful investment for all businesses.
RON HALL, PRESIDENT AND CHIEF EXECUTIVE OFFICER, BRIDGEWATER INTERIORS
2,797 Black or African American-owned Businesses in the Detroit Region
$7.0B Annual Sales $2.4B Annual Payroll
64,140 Employees 27% Businesses in Health Care and Social Assistance
Detroit Region’s Black-owned businesses increased by 71% since 2017, contributing billions to the regional economy.
The Detroit Police Department is shown here connecting with the city’s youth. Photo courtesy of the Detroit Resident Voices Survey report from the Detroit Regional Chamber and Gallup.
INCOME AND EDUCATIONAL ATTAINMENT
Despite Progress, Lingering Equity Gaps Threaten
Regional Economic Prosperity
► In 2023, Black or African American individuals experienced the largest increase in income at 11%, followed by Hispanic or Latino (3%) and white (1%).
► In 2023, Black or African American adults experienced the largest yearover-year increase in educational attainment at 3 percentage points, while other groups saw a decline of 1 percentage point.
Income Increased for Most Racial and Ethnic Groups in 2023, Yet Gaps Remain Per Capita Income by Race, Detroit MSA
Explore 14 key indicators focused on equity and inclusion, with over 60 graphs on the Detroit Regional Chamber’s Detroit Data Center under “Equity”.
detroitdatacenter.org
Educational Attainment Growth Highest for Black or African American Adults in 2023
Associate Degree or Higher, Population 25 and Older
To learn more about our other publications, visit detroitchamber.com/research.
About the Cover
The Great Lake freighters are vital to the economy, moving over 55 million tons of cargo in the state annually, transporting iron ore, limestone, grain, salt, and sand between Great Lakes ports. Over 17,000 jobs are directly and indirectly related to shipping within the Great Lakes and St. Lawrence Seaway System, generating over $3 billion in economic activity annually in Michigan. Pictured on the cover is the Mark W. Barker, the newest Great Lakes Freighter built in nearly 40 years.
