by Scott McClallen
Gov. Gretchen Whitmer and one economic analyst agree that Michigan needs more workers but disagree on the proper strategies necessary to acquire them.
John Mozena, president of the Center for Economic Accountability, a nonprofit organization for transparent economic development policy, questioned Whitmer’s “doubling down” on big business subsidies while many businesses need workers. There are about 10 million Michiganders but, as of January 2021, only 4.7 million are in the workforce.
Whitmer touted 170,000 new small business applications over the first three quarters of 2021 – 59% more than in 2019. She claimed in a news release Monday morning that those numbers indicate the fastest start to small business job growth in 23 years, citing Michigan Bureau of Labor Market Information.
“Recent data shows that entrepreneurs are fired up, starting tens of thousands of businesses and creating nearly 170,000 jobs,” Whitmer said in a statement. “While the numbers are encouraging, we must build on this momentum by making investments to retain and recruit more workers, expand operations, and attract additional investment. Together, let’s keep getting things done for Michigan’s booming small business community.”
Whitmer has attempted to drive Michigan’s economy by dumping hundreds of millions of taxpayer dollars into select private companies, including $824 million on General Motors’ electric vehicles programs. Her proposed $74 billion budget aims to spend $374 million subsidizing EVs, driven mainly by more affluent people. Only 13,545 EVs are registered in Michigan.
Instead of spending $374 million on EVs, Mozena suggested spending federal tax dollars to lure people into the workforce via reduced zoning regulations to encourage home-based businesses. It’s often cost-prohibitive for starting entrepreneurs to pay rent on their home and business for jobs that don’t require an additional building, such as an accountant.
The state and local governments often require zoning, permitting, or licensing regulations that make it nearly impossible to have a home-based business, Mozena said.
“A lot of these businesses are going to be home-based businesses,” Mozena said in a phone interview with The Center Square. “We have all been, over the past couple of years, working out of our homes in a way that we never have before.”
Mozena said that small business formation is up post-pandemic nationwide, which is one of the best signs of future economic prosperity. He questioned why Michigan is subsidizing big businesses “when businesses already can’t fill the jobs they have.”
“It seems like a poor use of taxpayer dollars to subsidize big businesses to give them even more of an advantage over all of these entrepreneurial startup companies when it comes time to compete for the same limited number of workers to fill those jobs,” Mozena said.
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