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UM report says Detroit's economy continues to recover, but only 36% of Detroiters earning living wage

Detroit skyline
Lester Graham
Michigan Radio
Detroit skyline

The latest Detroit Economic Forecast from the University of Michigan predicts a steady recovery over the next several years with wages continuing to rise.

Despite the rising wages, the report found that only 36% of Detroiters make a living wage.

Economist Gabriel Ehrlich wrote the report.

“This is a first step in understanding, you know, the living wage and who's earning a living wage in Detroit and what we can do and what the city can do to get the share of workers in Detroit who earn a living wage up,” he said.

Ehrlich said the City of Detroit asked him to look into the living wages of Detroit and other peer cities.

The report found only 36% of Detroit residents earn a living wage, compared with 45% in Milwaukee, 48% in Cleveland and 60% in Chicago.

The report considered many factors such as where people worked, what industry they worked in and how many hours a day they worked. It found that education, meaning a college or high school degree, accounted for about a third of the gap between Detroit and these other cities.

“The Detroit Economic Outlook for 2022-28 forecasts a jobless rate below 6% on a sustained basis in 2027 and 2028, and residents’ total inflation-adjusted income per capita to grow by nearly 6% during the forecast period—stronger than the state as a whole. Likewise, Detroit’s payroll employment count surpasses its pre-pandemic level by the end of this year, and by 2028 it stands at more than 11,000 jobs higher than in 2019,” a press release said.

Ehrlich said high inflation will consume many Detroiters incomes.

The report found the city’s blue-collar sector, which includes construction and manufacturing, has exceeded pre-pandemic levels.

Briana Rice is Michigan Public's criminal justice reporter. She's focused on what Detroiters need to feel safe and whether they're getting it.
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