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Michigan Manufacturing Survey

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The responses have been tabulated for the 2009 Michigan Manufacturing Survey conducted by the MMA in December. A summary of the results appear below or you can download the full results (see right). More detailed analysis of the results will also appear in the March/April issue of MMA’s Insight magazine.

In general, survey respondents seem to indicate that the worst is behind us, yet uncertainty about the future remains. With so much political and economic tumult, many manufacturers are hesitant to invest what little capital they do have. As one respondent explains, “We would like to buy more equipment but are afraid to use what cash we have.” To help assuage these fears, Michigan legislators must commit to a business-friendly environment and help provide more economic certainty for manufacturing to grow. According to another respondent, the primary business challenge for 2010 is “managing through the uncertainty created...in Lansing.”

For those who are still in business, there may be opportunities to expand and diversify within Michigan. These manufacturers will likely need resources to support strategic planning and market diversification to capitalize on these opportunities. As one respondent puts it, “I am looking beyond our traditional customer base to shore up sales over the next 5 years.” With a better business climate, continued efforts from great employees, and a smart strategic approach, manufacturers can still thrive in Michigan.

What We Learned

In general, the survey showed the following:

• Strategy and Diversification — The two key business initiatives identified by Michigan manufacturers are strategic planning and market diversification, consistent with the 2009 results.
• Health Care Costs — Concerns about the impact of health care costs top other cost concerns measured (tax, energy, labor, capital and regulatory).
• Michigan Not Business Friendly — As in 2009, Michigan manufacturers provide low ratings for Michigan as a business-friendly state.
• Manufacturers Staying in Michigan — Despite the poor view of Michigan as a business-friendly state, manufacturers generally plan to stay in Michigan, and some are even a bit more likely to expand within Michigan compared to 2009.
• Improving Manufacturing Outlook — The one-year business outlook for Michigan manufacturers has improved slightly since the beginning of 2009.

Who Responded

Of the 502 survey responses, 311 currently manufacture in Michigan. Of these 311 respondents:

• 100% are from companies with headquarters located in Michigan, compared to 89% in 2009.
• 88% manufacture at least some non-automotive products, up from 75% in 2009.
• 82% have 100 or fewer employees, up significantly from the 61% in 2009.
• 68% are with family-owned companies, up slightly from 63% in 2009.
• 58% are at executive levels with their companies, similar to the 61% in 2009.
• 21% say that their company’s manufacturing workforce in Michigan is fully or partially unionized, down somewhat from the 26% in 2009.

MMA partnered with Ann Arbor-based Baker Strategy Group again this year to conduct this second, in what is intended to be, an annual Manufacturing Survey. This valuable member feedback will help MMA direct its efforts in improving the business climate in Michigan for manufacturers.