Traverse City Record-Eagle

January 26, 2014

Editorial: Region must prepare for dual growth spurts

Traverse City Record-Eagle

---- — A detailed economic analysis of northwest Michigan’s economy predicts strong growth and a population boom over the next quarter-century.

The analysis by the Institute for Research on Labor, Employment and the Economy at the University of Michigan says growth should give entrepreneurs new chances for profits in health care, senior care, construction and the food service sectors.

That’s the good news. The flip side is that those same numbers represent the potential for a corresponding boom in low-wage, zero-benefits service economy jobs, already a substantial part of the economy. If the number of senior citizens doubles, as predicted, that means job growth in the senior care and food service sectors, neither of which offers much for the people who actually do the work.

Growth will also put an increasing load on the region’s infrastructure, such as roads; government services — including fire and rescue services — will be strained,

There are also predictions of a significant shortage of skilled workers in the Grand Traverse region over the next 30 years.

“It is going to be much harder to get employment gains because there are not going to be the people to fill those jobs, and it’s being driven by the aging of the population,” said senior research associate Don Grimes.

A worker shortage could mean business leaders will have to pay more attention to worker recruitment and retention because skilled workers will be much harder to find.

Luring skilled workers to the region will be only half the battle. Area governments and economic development entities will also be tasked with luring young professionals to the region to ensure there is a thriving population of upwardly mobile families to balance the growth in seniors.

The region will need more than service and construction jobs to thrive, and those will only come if the people who create such jobs live here.

Obviously, that means there have to be solid educational opportunities in both the K-12 and higher ed sectors, great medical care and opportunities for recreation and leisure activities.

The analysis predicts the region’s population will grow by 45,322 people, or 26 percent, by 2040. All five counties in the Grand Traverse region — Grand Traverse, Benzie, Leelanau, Antrim and Kalkaska — will grow, with Grand Traverse County’s population predicted to expand by 30,431 people, or 34 percent.

The biggest projected increases are in the senior population. The number of those 65 or older in Grand Traverse County will more than double, jumping by 101 percent by 2040. The region overall will see its senior population jump 63 percent.

That spike will offer business opportunities in the senior care sector, said Matt McCauley of the Northwest Michigan Council of Governments. Last fall, the national development firm Cordia Senior Living launched a $30.7 million development of 109 senior apartment residences at the Grand Traverse Commons.

The population boom will create many other employment opportunities, the study said.

The county’s ambulatory service and hospital employment is expect to double by 2040. Other growth areas include construction, a 39 percent jump by 2040; food services and drinking establishments, 32 percent and real estate, 34 percent growth.

While gains in health care, senior home care, construction and the food service sectors mean jobs, many of those are too low on the wage scale or not steady enough to ensure those workers can buy homes or send their kids to college. That makes it much more difficult for those people to put down roots or for their children to find work and stay here and raise their own families.

The challenge, then, will be to not only prepare for the surge in seniors and create the infrastructure they will need — home health care, home cleaning services, medical and emergency medical care — but to lure young professionals and entrepreneurs here to build a strong middle class and create good-paying jobs.

Because so many of the region’s jobs are in the tourism or food service industries, the Grand Traverse region knows all about the challenges workers in low-wage, zero-benefit jobs face, The prospect of those numbers soaring as the senior population doubles is not particularly rosy. It will be up to the business community and economic development sectors to ensure there are options for those who want to move on from cleaning homes, doing construction in the summer and waiting on tables.