Monthly Archives: October 2021

CPI Soars for Midwest Region

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In August of 2021 the unemployment rates for the State of Michigan remained steady from the previous months while the City of Detroit’s unemployment rate took a dip, following a slight increase the month prior. The State of Michigan reported an unemployment rate of 4.4 in August, which was just below the 5 percent unemployment rate reported in July. Since January of 2021 the State’s unemployment rate has not gone above 6.1 percent.

For the City of Detroit, the unemployment rate for August of 2021 was 8.4 percent, which is 1.7 points lower than the July unemployment rate and 10.8 points lower than the August 2020 rate.

Both data sets show that the unemployment rates in Michigan and Detroit are stabilizing to pre-pandemic rates.

The chart above shows unemployment rates beginning to level off and the chart below shows a deeper story—just how drastically unemployment rates have dropped in a year. Each county in Southeastern Michigan experienced an unemployment rate decrease between August of 2020 and August of 2021, with Wayne County experiencing the largest decrease at 8.5 points. In August of 2020 Wayne County had an unemployment rate of 13.3 percent and in August of 2021 it decreased to 4.8 percent. Monroe County had the smallest change in the last year with it recording an unemployment rate of 6.4 percent in August of 2020 and a rate of 5.2 percent in August of 2021. In August of 2021, Monroe County also had the highest unemployment rate regionally. Livingston County reported the lowest unemployment rate in August of 2021 at 2.4 percent while Washtenaw County reported the lowest unemployment rate in August of 2020 at 5.8 percent.

The charts below show the percent changes in the Consumer Price Index (CPI) on a month-to-month basis and a year-to-year basis for each month in years 2019, 2020 and 2021 in the Midwest Region. The CPI is a measure that examines the weighted average of prices of consumer goods and services, such as transportation, food, energy, housing and medical care. It is calculated by taking price changes for each item in the predetermined group of goods and averaging them.

The first  chart below highlights how the CPI changed on a month-to-month basis between 2019 and 2021. Prices in the Midwest region fell to their lowest in April of 2020, a -1.1 percent decline from the month prior; this was just as the pandemic was beginning. Just a month later though they increased by 0.8 percent. Currently in 2021, area prices are up 0.2 percent between August and September. According to the Bureau of Labor Statistics, food prices increased 1 percent between August and September of 2021, and energy prices increased 0.9 percent. Categories that were higher included shelter, apparel, household furnishings and operations.

When examining the second chart, which shows how prices changed on a year-to-year basis,  we see how prices in nearly the entire year of 2020 declined below what they were in 2019 (which was a fairly stable year) and how in 2021 the CPI has been lingering between about 5.5 and 5.9 percent since May. Of course, with the steep decline in 2020 due to the pandemic, we are likely to see a higher CPI in 2021 as everything begins to stabilize. However, some categories are experiencing rather large leaps. For example, in September of 2021 the CPI was up 5.7 percent from a year ago. One of the expenditures that has experienced a large increase in the CPI categories is gas services. Utility services are up 34.2 percent from a year ago and gasoline (motor fuel) is up 45.6 percent from a year ago. Under food and beverages, meats, poultry, fish and eggs experienced the highest increase at a 7.4 percent increase from a year ago, and housing experienced a 5.1 percent increase.
Home prices are being driven up by the demand for housing. In Metro Detroit, according to the Case-Shiller Home Price Index, the average price of single-family dwellings sold was $154,160 in July of 2021; this was $1,560 higher than the average family dwelling price in June. The July  2021 price was an increase of $21,700 from July of 2020 and $56,030 from July of 2014. Home prices have continued to increase year-after-year but the recent average price of single-family dwellings sold in the Metro-Detroit area has increased at a higher rate than in previous years, and it appears it may not be slowing down any time soon.

Pressures to Raise Wages in Michigan Continue

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Amidst the COVID pandemic, there are strong pressures to raise wages as government and businesses seek to draw back workers, who have stayed home. We see this in actions on prevailing wages and on minimum wages. Just last week, Gov. Gretchen Whitmer reinstated the prevailing wage for contractors working on State of Michigan projects. The prevailing wage is the average wage rate paid to groups of who do similar jobs/occupations; these wages are typically driven by union contracts. The purpose of a prevailing wage is to ensure companies that bid on government contracts don’t provide a low bid to the detriment of their employees. The new prevailing wage policy, which was originally repealed by the Republican-led Legislature in 2018, will impact only state contracts and projects. Federal projects are already subject to prevailing wage policies and local governments must implement their own policies to ensure fair wages are met.

In Michigan, the prevailing wage policy impacts occupations ranging from asbestos and lead abatement laborers to steel work engineers to roofers, and beyond. A list of occupations and their associated prevailing wages by county in Michigan in 2018 can be found here.

For reference on the difference of a prevailing wage by county, a bricklayer working on a state project in 2018 would have made the below rate, at a minimum:

  • Livingston County: $54.12
  • Macomb County: $52.43
  • Monroe County: $52.43
  • Oakland County: $52.43
  • St. Clair County: $52.34
  • Washtenaw County: $54.12
  • Wayne County: $52.43

According to the US Bureau of Labor Statistics, the mean wage for a brick mason in 2020 was $28.09. Of course, this mean wage accounts for every state in the country, where minimum and living wages vary, along with the cost of living.

In Michigan, the minimum wage is $9.65 an hour and the living wage for one adult with no children is $13.63. And, while Whitmer’s prevailing wage policy will impact state contracts, an increased minimum wage, state or nation-wide, would allow for greater economic stability for a large portion of the population and give way to economic growth.

An increase to the minimum wage requires policy changes, and inherent political tug-of-wars. And, while such actions should still be pursued and hopefully implemented, amidst the political turmoil that will likely occur during these discussions, businesses and local governments can implement their own wage policies. In Michigan, Oakland County and Oak Park both have policies where the minimum wage for their organizations is $15 an hour. Ann Arbor has a living wage policy for its employees and in its contracting ordinance, meaning the City must extend contracts to companies that pay their employees a living wage, at minimum. The Mayor of Jackson also just introduced an ordinance for a $15.68 an hour minimum wage rate for City employees and any contractor, vendor or grantee of City funds. The ordinance also proposes a $13.32 an hour minimum wage rate for employers that provide health care to employees. 

The 2021 living wages for Southeastern Michigan, by county are:

  • Livingston County: $13.91
  • Macomb County: $13.78
  • Monroe County: $13.67
  • Oakland County: $13.78
  • St. Clair County: $13.78
  • Washtenaw County: $15.62
  • Wayne County: $13.78

The above policies show how the State of Michigan and some local municipalities are making progress toward paying employees a true living wage and better aligning wages with salaries. However, the work must continue to ensure that all those employed and seeking employment earn wages that allow them to live a life above the poverty rate, a life in a city, state and country where disparities continue to shrink.

Public Corruption Continues to Grow in Southeastern Michigan

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Metro-Detroit is not unfamiliar with public corruption. At least once a year, but usually more often than that, a public corruption cases surfaces in Southeastern Michigan that involves a public official. Recent headlines have been focused on several public officials, including four from the Detroit City Council, three from the Detroit Police Department and three from Macomb County. These charges have surfaced over the last year or so, and have only driven the total number of public corruption cases that can be accounted for in the last four years. In total, there have been at least 32 public corruption charges since 2016 in Southeastern Michigan that involve either an elected official or a public employee. When including public contractors that number rises to about 40.

Most recently, investigations involve Detroit City Councilmembers Andre Spivey, Janee Ayers and Scott Benson. Last week, Andre Spivey pled guilty to federal bribery charges and admitted he and an aide received almost $36,000 in bribes. This case involving Spivey is connected to a larger investigation related to its towing operations. Ayers and Benson have not been charged with any crimes, however their homes have been raided in connection with this broad FBI investigation, according to news reports. The chief of staffs for Ayers and Benson are also included in this investigation but have not been charged. Since Ayers, Benson and their chief of staffs have not been charged with any crimes they were not included in the total number of regional corruption cases since 2016.

In addition to members of the Detroit City Council being investigated for possible crimes related to public corruption tied to City towing policies, so are three members of the Detroit Police Department. According to news reports from the Detroit Free Press and Detroit News, at least three members of the Detroit Police Department are suspected of accepting bribes from towing industry figures; no charges have been filed so these unnamed individuals were also not included in the regional public figure count.

In addition,  former Detroit Councilman Gabe Leland pled guilty to misconduct in office in May of 2021, and he resigned from City Council following the plea. Leland’s guilty plea stemmed from him being indicted on federal bribery charges and a felony misconduct in office charge for accepting $15,000 in cash and free car repairs in exchange for his vote on a land deal, according to the FBI. Leland admitted to accepting the cash when he pled guilty.

As corruption charges continue to surface in Detroit, public information from the FBI, news sources and local court documents shows that there have been at least 15 public corruption cases involving Detroit councilmembers or Detroit staffers; this number does not include contractors or business figures who have been involved in these corruption cases. In Wayne County (excluding Detroit), since 2016, there have been four public corruption charges. Wayne County, including Detroit, has the highest number of public corruption charges in the region, and the state, followed by Macomb County.

In Macomb County, the recent names making headlines for alleged public corruption are former Macomb County Prosecuting Attorney Eric Smith, former Macomb County Chief Assistant Prosecutor Ben Liston and suspended Macomb County Assistant Prosecutor Derek Miller. Miller recently asked for the misconduct in office and conspiracy to commit a legal in an illegal manner charges against him to be dropped. This request came because, according to news reports, Miller’s attorney claims there was no criminal intent with his interaction related to the larger case of alleged misuse of forfeiture funds by Smith. The charges still currently stand against Miller though, and Liston pled guilty to embezzlement charges for improper use of forfeiture funds in September of 2021. With this plea he is required to testify against Smith if requested to do so.

As for Smith, he pled guilty to a federal obstruction of justice charge for covering up theft from his campaign fund. While he pled guilting to this federal corruption charge in January of 2021, he has yet to be sentenced, in part because of his ongoing public corruption case with the State Attorney General’s Office. At the state level, Smith has been charged with five counts of embezzlement by a public official, one count conducting a federal enterprise, official misconduct in office, tampering with evidence in a civil proceeding, accessory after the fact to embezzlement by a public official and one count conspiracy to commit forgery, according to the Michigan Attorney General’s Office. Smith’s felony charges from the Michigan Attorney General’s Office are all in relation to alleged misuse of forfeiture funds. The initial charges against Smith were the state charges and occurred in March of 2020, and the federal charges came in September of 2020.

Since 2016 there have been 10 public officials from Macomb County, either the County organization itself or a municipality within its boundaries, who have been charged with alleged public corruption crimes. There are also cases tied to contractors and overall public corruption cases in Macomb County, that were not included in these counts. Many of the cases are related the Rizzo Environmental Services federal case that entangled elected officials, public employees and business figures who owned the business and worked with it.

No other county in the region or the state has had as many corruption cases the as Wayne and Macomb counties. Since 2016 there has been two public corruption cases in Oakland County and one in St. Clair County; no other county in the region has had any cases come to light.

Corruption cases have long riddled the Metro-Detroit region and in an upcoming post we will detail the ones that have been brought to the public eye since 2016. With more likely in the works, it is important to note that strong local journalism, citizen involvement in local government and an understanding of who is being elected can help reduce corruption cases. Of course, the fix is much more complicated than that, and this too will be explored at a later date.

Michigan’s Congressional Districts to Change Soon

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The new Congressional district maps for Michigan have not been finalized, but drafts are in the works, and districts are certain to change.

First off, the process in which Congressional and State House and State Senate districts are drawn has changed. Prior to 2018, the Michigan State Legislature redrew districts using population and demographic data from the US Census Bureau. This process was inherently political and lead to gerrymandered districts, as we highlighted in one of our earliest posts.

Come 2018, a change was mandated when Michigan voters approved the creation of the Michigan Independent Citizens Redistricting Commission. This Commission, which has been regularly meeting and taking public input over the last several months, is led by a bi-partisan citizen group. The MICRC is composed of four Democrats, four Republicans and five independents.

Another change regarding the mapping of Congressional districts was then announced in 2020—Michigan would lose a seat in the US House Representatives-dropping from 14 to 13—due to a shift in population. This is the fifth time in a row Michigan has lost a Congressional seat. This is because that other states have gained substantially more population than Michigan.

 In addition to Michigan losing a Congressional seat so did California, Illinois, Ohio, Pennsylvania, New York and West Virginia. The states that gained a single seat are: Colorado, Oregon, Montana, North Carolina and Florida. Texas gained two Congressional seats.

The map below shows the percent change in population between 2010 and 2020, according to the Census Bureau. And, while the map doesn’t highlight a significant population loss for Michigan it does show how other areas throughout the country are experiencing more rapid population growth while we remain increased only slightly.

Current MICRC proposals that affect Southeastern Michigan include Oakland County being included in five Congressional districts, as opposed to the four it is currently included in, Wayne County in three or four districts, as opposed to the two it is currently located in, and Macomb County being stretched amongst three or four districts, as opposed to the two it is currently in. All of these are still proposed, and non-finalized, maps of course. But this means shakeups for current members of Michigan’s Congressional Delegation. For example, a proposed map shows that current Congressman Andy Levin and current Congresswoman Brenda Lawrence could be living in the same district. Another proposed shift is for the 10th District, which could include parts of Oakland, Macomb and Genesee counties. The current Congress members who represent parts of that new proposed district are Elissa Slotkin (D-Holly), Dan Kildee (D-Flint) and Lisa McClain (R-Bruce Township). If that proposal were to move forward those current members of Congress could all be vying against each other in the election process.


According to the criteria approved by voters when they approved the MICRC, new district maps must:
·        Comply with the U.S. Voting Rights Act and be of equal population;
·        Be geographically contiguous;
·        Reflect the state’s diverse population and communities of interest;
·        Not provide a disproportionate advantage to any political party;
·        Not favor or disfavor an incumbent;
·        Respect county/municipal borders;
·        Be reasonably compact.
 
While Michigan’s population has changed minimally, there still have been population shifts internally, which will also impact the new Congressional districts.
For example, St. Clair County lost 1.6 percent of its population and Wayne County lost 1.5 percent of its population between 2010 and 2020, while Washtenaw County experienced about an 8 percent population increase, and Livingston County experienced about a 7.5 percent population increase. While Congressional seats don’t include just one county, understanding where the State’s population has shifted does help shed light on how the districts may shift.

The final Congressional District maps will go into play for the 2022 election. Three maps for final consideration must be chosen by the MICRC on Oct. 1, 2021. To leave a comment on the proposed maps or the process visit here.