In a Recent Diary on Detroit's unemployment Rich in PA asked what type of jobs should Detroit get as many of the old jobs might not be relevant (and its not like they belonged to Detroit by Divine Right anyways). This struck my mind as I'm wondering about what type of jobs Michigan (the state as a whole isn't as bad as Detroit, but its pretty bad) should get as the actual regular automotive production jobs have (mostly) left (there are a few GM plants, a few Ford plants, the Ford/Mazada Auto Alliance plant in Flat Rock which makes the Mazda 3 and Ford Mustang, a Chysler plant or 2 in Detroit, etc.) and the supply base has been decimated. To do that I propose looking at Michigan's strengths, which are more varied than many people think.
A SWOT analysis is not really as good a breakdown as people think. Further, the opportunities and threats sections are pretty self evident when you think about it for Michigan's economy. However, to decide what direction you want to go in, you need to realize what assets you already have.
Michigan's Strength's
While they aren't as well know (with the notable exception of the University of Michigan), Michigan's university system is a tremendous strength to the state as a whole whether it is having 3 Tier 1 Research Institutions (University of Michigan, Michigan State University, and Wayne State University) or at least 2 quality universities that aren't Tier 1 (Oakland University, Grand Valley STate University) or any number of universities that aren't primarily research but are high quality learning institutions (Eastern Michigan, Western Michigan, Walsh College, Central Michigan University). Further all 3 of the major research universities have had spin-offs that have (or in process of) being companies that are helping Michigan diversify its economy (Esperion Therapeutics in Ann Arbor, and in an older, more establish example: Neogen). However, Michigan's strength in Universities is in heavy danger of erroding as Jennifer Granholm's favorite spot to balance the budget is by taking money away from the college's, which is one of the stupidest decisions by a state chief executive in Michigan's history. But Michigan's university's are a tremendous boon as, even though the state's portion of college graduates slightly below the national average (http://quickfacts.census.gov/qfd/states/26000.html) the local opportunity is available to do so and many of the state's cities are either close to or above the national averages (and its not just college town's like Ann Arbor either, Troy had also 50% with college educations, Livonia almost 30%, Grand Rapids at 24%, etc.).
Another major strength for the state of Michigan is that it is one of the state's that has infrastructure in place to benefit from the recent look at biological science/healthcare as it not only has the universities but it has a number of top notch hospitals (U of M Health, DMC, Henry Ford Hospital among others) and more than a few interesting private companies (Asterand, Esperion, Lycera, Tech Town managed to convince Israel Adult Stem Cell company Taburit to come to Detroit as the basis for it's US operations, and if it can get its financial house in order Aastrom). The big problem is that Biosciences does have tremendous competition for jobs and every black eye Detroit gets will probably convince investors/decision makes to look elsewhere.
While the automotive production area is not ever going to come back, I don't think you can say that the "knowledge" type of jobs in automotive are going to go away entirely. And Michigan should continue to be strong in this regard, not only in regard to the "Big 3" but also for supplying engineering/design centers for overseas companies (Toyota and Hyundai have Tech Centers in Michigan, and Subaru has a testing center in Michigan). This could statement could be said to include the new "electric/battery" work for automotive that is coming from the new GE facility as well as the A123 Systems facilities (while it helps the state economy someone needs to tell Jennifer Granholm that these are not non-automotive jobs, as they are working on things for cars).
The environment: While people don't think about it much, Michigan is turning into a nice tourism destination with its current environment of Great Lakes and the Pure Michigan Campaign (which will be coming back in the Spring). In addition to that, Michigan's environment has proven to be popular with film makers (after a large tax incentive was included) as a large number of movies are being worked on/have been made in Michigan in the past couple of years (Gran Turino, Whip It, the remake of Red Dawn, Little Murder, The Irishman, and a few others). This movie work has led to 2 production studios to begin the process of opening (one in Allen Park, the other in Pontiac, there are others but these 2 are the most credible in terms of the people behind them).
Negatives for Michigan
Detroit, and the many bad news headlines it has received: Detroit is unfortunately the face of Michigan and whenever its been in the news for the past 5 years or so its only been for bad news. Whether its the school systems historically bad level of scoring (which prompted Fox News personality Sheppard Smith to say he'd burn the school system down), heavy political corruption (disgraced ex-Mayor Kwame Kilpatrick, former Councilwoman Monica Conyers, etc.), to the blows to the Big 3 and blows from Time Magazine (I have no proof of this, but I'd be willing to bet money that that cover story convinced at least one business person who was on the fence about Detroit to say "No, I think I'll pass"). Unfortunately this is creating a self-perpetuating cycle as the bad news makes it harder for companies based in Detroit to be viable (IBM nearly put Michigan software company Compuware out of business primarily by doing the sales equivalent of "Do you want to go with us, or some company from Detroit", Comerica basically moved to Texas for just this reason, they technically have presence in Michigan but they aren't making any new loans, thus depriving the state of the one positive function that banks are supposed to provide) forcing them to move out, costing jobs, lowering the standard of living, leading to more negative headlines, etc. Dave Bing is doing what he can for the city government and Robert Bobb is doing what he can to help the school system (being fought by the incompetent, corrupt school board every step of the way) but I don't know how much progress can be made in the city, we've pretty much reached terminal velocity of the great unravelling and I can't see how it can be stopped.
Lack of Access to Education: To balance the budget Michigan not only killed the Promise Scholarship grant but also eliminated or curtailed many other scholarship programs, combining this with the cuts to education, this is leading to tuition increases that are putting college educations out of reach of more and more people.
Political turmoil: Michigan has the single most disfunctional state government in the country, as it is unable to even get a budget out on time, an irony considering that they are one of the only states in the country with a full time legislature (and the correspondent higher pay that that entals). The state can't even plan to budget as every year it is a down to the wire last minute juggling act that involves a series of one time actions without any long term plan for the state (it is one of these periods that led to the Michigan Business Tax surcharge, one of the only definite examples of a tax being a confirmed job killer).
Things Need to Change
Michigan needs to budget for its assets and build based on its current strengths. MOre money needs to go into enabling students to afford college, less cultural war against biological research (including a sleazy attempt by the Republican state senate to covertly undo the state initiative that allowed for stem cell research), the Michigan business tax needs to be repealed (and a raise in the beer tax considered), some state works will need to take a haircut (necessary in Detroit no matter how much AFSCME doesn't want to hear it), and the film tax credits should probably be kept for a few more years. Recovery is possible, but not until the political establishment is willing to do more than "Flex its Pecs for the Special INterests that they serve".