Key Findings On S.E. Michigan's Economic State

Region Poised for Recovery through 'New-Economy' Activity

TROY, Mich., Oct. 13 -- Automation Alley, which drives the growth and image of Southeast Michigan's technology economy, today released key results of a study by the Anderson Economic Group, titled Automation Alley's Technology Industry: Driving Southeast Michigan Forward. The study reviews the state of Southeast Michigan's economy, and concludes that while the region has experienced economic difficulties, a wealth of "new-economy" activities are taking place, positioning Southeast Michigan as an economic stronghold with tremendous technological vitality.

"While it is a fact that Southeast Michigan has experienced a loss of manufacturing jobs and increased unemployment, it is also a fact that we are leading the way in the development of a new economy," said Ken Rogers, executive director, Automation Alley. "This new economy relies on technology to remain competitive on a global scale. As a leader in technology industry employment across the United States, Automation Alley is well positioned to experience tremendous growth in the short- and long-term."

The Anderson Economic Group study provides evidence for Automation Alley's leadership in the new economy, primarily using data from a five-year period between 1998 and 2003. The results indicate the region's technology industry is one with above average wages, high-skilled and high-knowledge jobs, groundbreaking discoveries, and investment by firms from around the world. Specifically, between 1998 and 2003, total payroll in Southeast Michigan's technology industry increased by nearly 14 percent, outpacing annual inflation. This resulted in an increase in the average wage per technology job from $52,904 in 1998 to $65,722 in 2003. The payroll for all technology industry employees in 2003 totaled over $22 million, accounting for more than 24 percent of the region's overall wages. According to the Anderson Economic Group's study, the higher payroll share indicates Southeast Michigan's technology industry provides higher wages than jobs in the general economy.

"The Anderson Report accurately defines Southeast Michigan as one of the nation's high technology regions," said Chip McClure, chairman, CEO and president, ArvinMeritor, a foundation member of Automation Alley. "In particular, by clarifying that technology is not only a product, but a manner of producing, the report properly recognizes the technological strength of our region's industries."

In addition to increased wages, technology industry employment grew by more than 6 percent from 2002 to 2003. The number of small technology establishments (employing under 100) has also increased in recent years, accounting for more than 7,500 of the approximately 8,100 technology organizations in Automation Alley.

"At the same time the number of small technology companies is growing, our overall diversity is increasing," said Rogers. "Sectors such as life sciences, information technology, chemical and material, and advanced manufacturing are gaining an increased presence within the Southeast Michigan region."

In addition, technology companies and the educational community are investing significant financial resources into research and development (R&D) throughout Southeast Michigan, helping make the State of Michigan the nation's leader in R&D density, diversity and depth. Between 1999 and 2003, companies in the Automation Alley region received 71 percent of all the patents awarded in the state. Additionally, from 1997 to 2002, universities in Automation Alley increased R&D spending by approximately 44 percent, resulting in expenditures exceeding $885 million in 2002.

Corporate commitment to R&D in Southeast Michigan is continuing to accelerate, particularly within the automotive industry. For example, General Motors is building a $1 billion Vehicle Engineering Center at its Tech Center campus in Warren. Additionally, in April, Toyota announced a $150 million expansion of the Toyota Technical Center in York Township (Washtenaw County).

"A main indicator of growth potential for a region's technology industry is the amount of research and development taking place," said Patrick Anderson, principal, Anderson Economic Group. "Automation Alley is at the forefront of R&D, and that status is paying significant dividends for the region."

Data from the Anderson Economic Group's study takes a variety of factors into account, including employment, number of private businesses, payroll, demographics, socio-economics and quality of life. A copy of the report can be secured by going to http://www.automationalley.com/ .

About Automation Alley

Automation Alley drives the growth and image of Southeast Michigan's technology economy through a collaborative culture that focuses on workforce and business development initiatives.

More than 580 businesses, educational institutions and government entities belong to Automation Alley, covering an eight county area and the City of Detroit. Automation Alley promotes regional prosperity through the Automation Alley International Business Center, which provides business attraction services and exporting assistance; the Automation Alley Technology Center, which brings together businesses, educators and government to help entrepreneurs accelerate technology commercialization; and the GLIMA Network, one of the country's largest associations for individuals involved in the business of technology and related fields.

For more information, visit http://www.automationalley.com/ .