Crain’s reporter: Detroit’s recovery progressing
Detroit is recovering from its 2013 bankruptcy by focusing on improving schools and economic development, Chad Livengood, reporter for Crain’s Detroit Business, told Capitol Issues Forum Sept. 20 in his talk “Covering Detroit’s Resurgence.” As city leaders tackle blight, expensive auto insurance and workforce challenges, Detroit’s comeback story is still being written.
Investments by entrepreneurs like Tom Gores, Dan Gilbert and Shahid Khan have brought business and jobs into the city’s downtown and midtown districts. Khan, owner of Flex-N-Gate, plans to invest millions to build a new auto parts factory in Detroit. Gilbert, founder of Quicken Loans, has invested more than $1.6 billion in downtown Detroit real estate since 2007.
Although economic development in the city’s core is robust with an increasing number of investors, Detroit does not have enough trained professionals to fill the many job opportunities available in the city. One such high demand position is skilled trades professionals like ironworkers. Due to the low number of qualified Detroit workers, the construction company that built the Little Caesars arena paid millions of dollars in fines for failing to meet the requirement that 51 percent of workers on a publicly-funded construction project be Detroit residents.
In light of the employment gap, the city has turned its attention toward pre-apprenticeship education and after school literacy programs to help fill talent vacancies. A pre-apprenticeship program, started by Detroiter and ex-con Dino Vann, has had success in preparing individuals for skilled trades jobs within Detroit. After school literacy programs, run by local Detroit businesses, help elevate students’ reading levels and increase graduation rates.
Despite improvements downtown, commercial blight continues to plague Detroit because most federal funding for blight removal goes toward demolishing homes rather than former businesses and industrial buildings. Livengood described a convenience store that burned down and wasn’t cleared for several months, despite phone calls he made to the city.
Detroit is also considering outside opportunities to help revitalize the area. The city submitted a proposal, in collaboration with Windsor, to be the location of Amazon’s new office headquarters. If chosen, Detroit could land up to 50,000 new jobs.
Expensive auto insurance is another burden Detroit residents carry, with rates among the highest in the country, causing many Detroiters to lose drivers’ licenses and their transportation to work. Detroit Mayor Duggan is pushing for auto insurance reform to help boost the economy and living standard for residents. Duggan’s plan would allow people to choose less expensive levels of personal injury protection plans, and the unlimited medical insurance to cover serious crash injuries would no longer be required, according to Livengood.
Since Detroit filed for bankruptcy, the city has made great strides in improving financial and education problems. Livengood acknowledged that Detroit must continue its restoration in order to capitalize on development opportunities like the Amazon headquarters.