Rick Haglund: Don’t count on Trump losing Michigan in 2020 over the economy

December 22, 2019 5:34 am

President Donald Trump rally in Battle Creek, Dec. 18, 2019 | Andrew Roth

President Donald Trump, who was impeached for abuse of power and obstruction of Congress, is a bully and world-class vulgarian.

Who else would come to Michigan, a state critical to his reelection, and suggest, as Trump did on the same day of his impeachment, that its late, revered native son U.S. Rep. John Dingell (D-Dearborn) might be in hell?

But those hoping that Trump will lose his bid for a second term next year because of a weakening economy are likely to be sorely disappointed.

Yes, the economy is slowing, particularly in Michigan and other Midwest swing states that Trump must win to convulse the nation for another four years.

A recent New York Times analysis found that job growth in the Midwest since Trump took office at the start of 2017 has lagged most of the rest of the country.

Job growth in Michigan has risen a paltry 1.8% during Trump’s almost three years as president, according to the Times’ analysis. That’s less than in all but eight other states.

Iowa, Ohio, Pennsylvania and Wisconsin, states that former President Barack Obama won in 2012, but that Trump captured in 2016, have posted similarly low job growth rates under Trump.

The question is whether the slowdown will be enough to make Midwest voters reject Trump in favor of a Democratic challenger. 

Voters have many available reasons to toss Trump from the White House — his vile behavior and penchant for law-breaking among them. But the economy might be the least of Trump’s re-election worries.

Michigan, one of the country’s top manufacturing states, provides a window into the economic climate Trump is likely to face as the November 2020 election draws closer.

The latest University of Michigan state economic forecast predicts a significant drop in job growth over the next two years from 2017 and 2018. But the slowdown isn’t likely to panic voters.

“The sun has stopped shining on Michigan’s economy this year, but fortunately, we are accustomed to capricious weather,” U of M economists Jacob Burton, Gabriel Ehrlich, Donald Grimes and Michael McWilliams wrote in their forecast.

Michigan voters might even feel better about the economy next year after the state shakes off the pain of the recent, nearly six-week-long United Auto Workers strike against General Motors. The strike temporarily cost the state 11,200 jobs.

U of M economists say Michigan will “return to respectable job growth over the next two years, if, as we expect, the national economy avoids recession.”

GM is running its truck plants flat out and requiring mandatory Sunday overtime to make up for lost production during the strike of its highly profitable full-size pickup trucks and SUVs.

UAW members at Fiat Chrysler, Ford and GM are profiting from new contracts that give them higher wages, big signing bonuses and no increases in health care costs.

And the Detroit Three automakers also have committed to spending billions of dollars in new and refurbished factories that will add thousands of new jobs in Michigan.

There are other positive signs about Michigan’s short-term economic prospects. 

Michigan’s labor participation rate — the percentage of working age adults who are employed or looking for work — is slowly rising after years of decline, according to the U of M economists. The state’s jobless rate is expected to fall from 4.1%  this year to 3.9% in 2020 and 3.7% in 2021.

“That rate would be on par with 1999 and 2000 as the lowest annual average unemployment rate in Michigan’s history since the current data series (began) in 1976,” the U of M economists said.

Not every economic indicator in the state is positive. The state’s slowdown in job growth has been dramatic, falling by more than half, from 50,000 new jobs in 2018 to an estimated 20,300 in this year.

U of M predicts the state will add 29,000 jobs in 2020 and 25,900 jobs in 2021.

But after producing an average of more than 10,000 jobs a year since 2000, manufacturing is expected to create only 3,600 of those jobs over the next two years.

That estimate could prove to be optimistic. U.S. Steel announced Thursday it’s idling operations near Detroit in April, eliminating 1,545 jobs.

Personal income growth is slowing as well, falling from an increase of 4.9 percent in 2018 to a predicted 3.1%  jump in 2021, according to the U of M forecast.

But it’s important to note that we’re still talking about rising job and income growth, just at a slower pace than in the past several years.

Plus, there have been several recent developments in Washington that could benefit Michigan’s manufacturing-based economy.

The U.S. House passed the United States-Mexico-Canada Agreement (USMCA) on Thursday, easing  uncertainty for automakers, parts suppliers and other manufacturers about the future of more than $1 trillion in annual trade among the three countries.

The USMCA, which replaces the controversial North American Free Trade Agreement (NAFTA), is one of Trump’s top economic policy initiatives. The U.S. Senate is expected to pass it early next year.

Meanwhile, China and the United States are said to be nearing a partial trade deal that could reduce tariffs on Chinese-produced goods and allow U.S. companies to sell more products to China, a potential thaw in a dangerous trade war.

Many, including some prominent Republicans, say Trump’s lawlessness and authoritarian tendencies are a threat to democracy.

But he is likely to be defeated at the polls next year only if voters are concerned about more than their own pocketbooks.

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Rick Haglund
Rick Haglund

Rick Haglund writes the "Micheconomy" column for the Michigan Advance. He's a former reporter and business columnist for Booth Newspapers, now the MLive Media Group, with extensive experience covering Michigan’s economy and the auto industry. He now works as a freelance writer based in Southeast Michigan.