Michigan local economies still struggling with the pandemic effects

September 29, 2021

Michigan's local economies are still struggling with the effects of the COVID-19 pandemic but at a much lower rate than at the start of the crisis in spring 2020, according to a University of Michigan statewide survey of local government officials.

As of spring 2021, 39% of Michigan local officials report their local economies have suffered significant (33%) or even crisis-level (6%) impacts over the past year of the pandemic. However, this is down sharply from the 86% of jurisdictions that reported the severe economic impacts at the beginning of the pandemic in 2020.

Local governments in 75% of the state's largest jurisdictions say they have taken or are planning to take at least one action to support local businesses. Among all jurisdictions that had taken actions as of spring 2021, two-thirds (66%) believe they have been somewhat (55%) or very (11%) effective, and just 6% say they have been ineffective.

Efforts by those that report taking action include promoting or advertising local small businesses to the community (21%), waiving fees and fines, extending payment deadlines (19%), and creating more space for social distancing such as closing local roads and issuing permits for outdoor dining (17%). 

These are among the first findings of the spring 2021 wave of the Michigan Public Policy Survey (MPPS), conducted between April 5 and June 7 by the Ford School of Public Policy's Center for Local, State, and Urban Policy (CLOSUP).

The pandemic still is causing major economic disruption: Officials from Michigan's largest jurisdictions are the most likely to report negative impacts on their local economies, including 61% that still report significant (49%) or crisis-level (12%) economic impacts in 2021. This figure is down from 99% that reported such impacts in 2020. 

"This survey shows us that the worst economic effects of the pandemic may be behind us, but there is still a lot of work to do before local governments feel they have fully emerged," said CLOSUP Executive Director Tom Ivacko.   

One local government official said his economic development department hosts a weekly Zoom meeting with the community economic development directors and chambers of commerce to collaborate on joint marketing efforts and business loans. The official added it's serving as a model for other counties and regions.

"Local leaders are the best-positioned officials to understand the unique challenges in their communities, and to see how government can help," said Natalie Fitzpatrick, CLOSUP research specialist and lead author on the report.

"Local governments have been flexible in their approaches to supporting their small businesses, which the survey shows has benefitted a large number of Michiganders," said Debra Horner, CLOSUP project manager.

The MPPS is an ongoing census survey of all 1,856 general purpose local governments in Michigan conducted by CLOSUP since 2009. Respondents for the spring wave include county administrators, board chairs and clerks; city mayors, managers and clerks; village presidents, managers and clerks; and township supervisors, managers and clerks from 1,364 jurisdictions statewide. 

The survey is conducted with the Michigan Association of Counties, Michigan Municipal League and Michigan Townships Association. The analysis includes comparisons to public opinion data from the State of the State Survey conducted by Michigan State University.

The report can be seen here.

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