If the people of Michigan want to turn their economy around, they're going to have to be willing to throw out old ways of thinking and embrace new ones.

That was the message brought home at the New Economy 101 workshop Thursday, April 29, at Little Bear East Arena in St. Ignace, part of a statewide program called the Michigan Prosperity Initiative put together by the Michigan State University (MSU) Land Policy Institute. The workshop was the first in a series of three to be presented at 50 locations across the state to help people understand Michigan's economic problems and how regional strategies can help bring prosperity back to communities. Workshop organizers want to change the public's mindset about Michigan's opportunities and convince citizens that they can play an important role in its recovery.

Michigan's decline did not come as a surprise to economic analysts.

Michigan set itself up for an economic collapse by subscribing to an old economic model, relying too much on manufacturing when it should have been branching out into new industries, according to the presentation, conducted by Michelle Walk, MSU Extension director for Mackinac County.

As a result, employment rates in Michigan have spiraled down for 10 consecutive years. Unlike the rest of the country, which has recently entered recession, Michigan's problems go back for at least a decade, a trend the presentation called a “profound deterioration of jobs.” The state lost 400,000 manufacturing jobs in the last decade, the most in the U.S, and its downturn was worse and reached deeper levels than that of the national economy. Since 2001, nearly one out of every five jobs in the state have been lost.

Michigan is long overdue to abandon the ways of the “old economy,” which relies on the manufacturing and sale of goods, and embrace the “new economy,” based on knowledge and service, analysts say.

The rise and fall of Detroit, for instance, illustrates the economic shift from the old economy to the new. As the birthplace of the auto industry, the city was the national leader in the 20th century's industrial era, when cities thrived on manufacturing. In 1954 its population peaked at 1.85 million, and it is now down to 777,493, less than half of its peak level. The city's infrastructure, designed for that peak population, is now being supported by a population less than half that size, one factor in Detroit's decline.

All industries have a life cycle, with a predictable peak. Once that peak is reached and that industry begins to decline, analysts say, plans should already be in place for new emerging industries to take the lead. Economies that are based on manufacturing industries past their peak, such as Michigan's, cannot grow, the presentation reports, especially when labor costs are lower in other places, such as Third World counties. Instead of focusing on manufacturing, the state should be focusing on industries that are growing and paying higher wages. Since the 1930s, analysts have been calling for more diversification in Michigan's economy.

Another part of the problem is that Michigan ranks eighth in the U.S. in mortgage foreclosures, which has made it difficult for people who want to leave, lowering home prices for sellers, and creating abandoned homes and neighborhoods. Michigan's population decline would probably be even stronger, the report shows, if all of the people who want to leave the state could sell their homes.

To compete in today's new economy, then, Michigan needs to rely more on its brains, not just its hands. Regional strategies should be in place that draw more people to the state, especially knowledge workers and entrepreneurs, who play an instrumental role creating new businesses and jobs. Michigan has several strengths it can draw on to carry these plans out.

Places that are considered high quality places to live, and that would likely draw new residents, usually offer lots of choices in housing, transportation, entertainment, infrastructure, and recreation. Amenities that people look for, studies show, include sports, hunting, fishing, bicycle paths, waterways, and greenery. This is good news for Michigan, according to the presentation, because the state has an abundance of these soughtafter attributes.

Core cities, such as Detroit, Flint, Grand Rapids, and Lansing, also must play a critical role in Michigan's revival, as no state with a strong economy also has a major metro area in serious distress. In the case of isolated, rural towns, economies should be geared toward taking improving existing assets.

Green infrastructure and renewable energy will also play an important role in the state's future. Offshore wind energy, for example, has the potential of yielding 100% of the state's electrical energy. Solar energy could also play a pivotal role, as the state's energy potential is greater than that of Germany, the leading solar energy provider in the world. The state should be exploring ways to capitalize on these opportunities, the presentation advises.

One area everyone in the state can work on, the presentation suggested, is changing their mindset, which influences decision making. Rather than attributing the state's problems to the auto industry, for example, and waiting for that industry to regain strength, everyone should take personal responsibility for bringing the state back into prosperity, taking advantage of opportunities for economic growth when they arise. Michigan's manufacturing industry will not return to its former peak, studies show, and entrepreneurs and businesses should look for other engines that can drive the economy.

Those who are interested in attending a New Economy 201 workshop, a four-hour program that will focus on identifying regional economic strategies, may contact Michelle Walk at 643-7307 to be put on a waiting list. One session of the workshop, set for May 3 in Sault Ste. Marie, was filled to capacity and a second session may be scheduled in the area.

Partners in the Michigan Prosperity Initiative are Michigan Department of Energy, Labor, and Economic Growth, the Michigan Economic Development Corporation, the Michigan Association of Regions, Michigan Municipal League, Michigan Townships Association, and the Michigan Association of Planning.