Detroit Metropolitan Area 2024 Economic Outlook

Expected employment growth for the Detroit area shows continued growth. Much of this growth is comes from the manufacturing sector, where U.S. manufacturing has experienced somewhat of a resurgence over the last few years. Some of this is momentum in consumer purchasing behaviors following the COVID19 restrictions on gatherings and travel. In Michigan, a large component appears to be associated with the vehicle manufacturing and supplying industries. Accordingly, we anticipate that 2023 employment growth for the Detroit-Warren-Dearborn area will grow by 2.4 percent in 2023, down from 3.8 in 2022, and forecast 2024 growth at 2.3 percent. Within this projection, manufacturing employment growth is expected to jump by 3.1 and 7.4 percent, respectively, for 2023 and 2024. Employment in service providing sectors is expected to draw down from the post COVID19 bump of 3.9 percent growth in both 2021 and 2022. Expect service job growth to increase by 2.3 percent in 2023 and by 1.5 percent growth in 2024. Of the service sectors, leisure and hospitality sectors will experience robust growth as consumers continue to shift spending back to services.

Detroit’s labor force and employment, like much of America and Michigan, have been on divergent paths since the pandemic. Employment growth has exceeded labor force growth by 9.3 percent since the start of 2021, leaving an extremely tight labor market. Right now, job seekers have the advantage. While job growth in Detroit is expected to taper over the next year, it is still expected to move at the pace of labor force growth. That is, labor markets in Detroit are expected to remain tight through 2024. 

Detroit production growth, as measured by contribution to gross state product, is expected to be subdued through 2024. In nominal terms GSP is expected to gain 5.6 percent in 2023 and 4.2 in 2024. Personal income in 2023 is expected to take a negative turn as COVID10-related stimulus programs sunset. Expect reduced personal income by about 4.7 in 2023 but for that to be regained in 2024.

Updated October 4, 2023