A University of Michigan economic forecast for Detroit expresses "cautious optimism" for the city over the next few years.
Gabriel Ehrlich is an economic forecaster at the university. He said he expects a modest increase in wages, jobs, and labor force through 2028.
Among the report's findings:
- Payroll jobs are expected to increase by 3,000 this year after 600 net job losses in 2023. Job gains accelerate to 3,800 in 2025 and then average 1,700 a year for the duration of the forecast.
- Detroit's jobless rate is expected to average 8.2% this year and edge down to 7.1% by 2028. The city's labor force reaches its highest level since 2013 by the end of the forecast.
- Wage growth at payroll jobs in the city averages 3.4% a year during the outlook period. Growth for city residents averages 3.7% during the same time, and both outpace statewide wage growth of 3%.
- Average wage and salary income for employed Detroit residents should increase to roughly $50,000 — 42% higher than 2019.
Ehrlich said Detroit still faces many challenges, but at the same time, some people may still be holding on to overly pessimistic ideas about the city's economy.
"Obviously perceptions take a long time to change, and I don't want to sugarcoat the real problems that Detroit faces," he said. "But I do want to say that Detroit's economy has shown a lot of resilience in the face of some difficult circumstances."
Erlich said one of those signs of resilience is the fact the city has nearly recovered all the jobs it lost during the pandemic.
But he said high interest rates do pose a near-term risk to the city's economy. That's because high rates can slow growth in auto manufacturing and mortgage lending.
