The Michigan Turnaround Plan (2012)

LAYING THE FOUNDATION TO BUILD A NEW MICHIGAN

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2 Letter from the Chairman and CEO

3 Executive Summary

4 The Case for Change

5 The Impact on Michigan

7 Michigan’s Competitive Position

12 Progress

14 2012 Michigan Turnaround Plan Overview

25 The Six Step Turnaround Plan

27 Where We Could Be

Who We Are

Dedicated to making Michigan a “Top Ten” state for job, economic and personal income growth.

The state’s business roundtable: composed of the chairpersons, chief executives or most seniorexecutives of the state’s largest job providers and universities.

Driving nearly one-quarter of the state’s economy: provide over 320,000 direct jobs in Michigan,generate over $1 trillion in annual revenue, and serve over 135,000 students.

www.BusinessLeadersForMichigan.com

Business Leaders for Michigan (BLM) is an organization dedicated to making Michigan a “Top Ten” state for job andeconomic growth. We serve as a catalyst for change, a visionary organization that supports its ideas with carefulresearch, thorough planning, and accountability for results.

In 2009, we unveiled the Michigan Turnaround Plan (MTP), an aggressive agenda to make Michigan a Top Ten Statefor job and economic growth. The Plan set forward the case for change, naming achievable goals, identifying actionsteps and explaining the potential impact of change. The Plan is organized around a five-step strategy: improving theway the state manages its finances, improving the efficiency and effectiveness of the public sector, getting Michigancompetitive to attract and retain jobs, making investments that will create a great job environment and acceleratingjob growth through innovation and entrepreneurship.

We have worked closely with government, policy and business leaders to affect meaningful advancement of eachMTP objective. Citizens and stakeholders have rallied around the MTP. Thanks to policy makers in Lansing, the pasttwelve months have been game-changers for our state and many components of the MTP are now in place.

Using our Michigan Turnaround Plan as a checklist, we can see how much has been done to strengthen our stateand reshape its economy. Our state finances are managed better, our tax policy has been improved, our regulatoryenvironment makes more sense, and the conditions are right to foster growth in our state, creating new jobs andbringing life to our communities. As you read this report, we think you’ll see that much has been done to strengthenMichigan’s economic environment. Our economy might not be a Top Ten State yet, but we’re well on our way.

In the 2012 Michigan Turnaround Plan, we identify what work remains in Steps 1-5 to further strengthen our state’scompetitiveness and put our state on a solid path to prosperity.

Now that our foundation is more solid, it is time to add a sixth step to the MTP – Leveraging Assets to Grow the NewMichigan. We identify existing Michigan assets that we believe, based on solid data, can be leveraged to accelerategrowth and transition to the New Michigan. It’s a 10+ year vision that builds on the first five steps of the Plan. Wedetail the possibilities we see in each “growth opportunity” to reshape and strengthen the Michigan of tomorrow.

But this will require a shared vision for the future, one that allows us to effectively allocate resources, evaluate plans, andmaintain a coherent approach beyond election cycles. We have the capacity to move into a future that glows with promise.We invite you to be part of this work. Each of us can have a role in Michigan’s turnaround. Together, we can seize controlof our destiny, make a shift in how we approach the future, and drive lasting change for the people of our great state.

Sincerely,

James B. Nicholson Doug RothwellChair of the Board President & CEO

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EXECUTIVE SUMMARY

A State in Transition

Michigan has been getting poorer, smaller and less competitive relative toother states for nearly 50 years. The state needs significant economicgrowth to meet and ultimately surpass its U.S. and global competitors.

Incremental changes to the state’s budget, tax and economic developmentpolicies will be insufficient to grow the state’s economy fast enough tobecome a “Top Ten” state.

The Michigan Turnaround Plan is a holistic strategy for accelerating growth.

1. US Bureau of Economic Analysis, 2. BLM 2011 Benchmarking Report

Past Prosperous StatePer capita personal income 14% above the national averagein the 1950s1

Recent Trends Relative DeclineEconomic decline began in 1960s and accelerated rapidly beginning in2000 as Michigan fell from above average to below average growth

Root Cause UncompetitiveMichigan ranks average to below average on many factorsthat drive job creation2

Today Turnaround UnderwayReforms are helping to improve economy, but complete turnaround will takeyears — per capita income 13% below national average1

Future Michigan Turnaround PlanA holistic plan that builds on Michigan’s strengths to make Michigan a Top Tenstate for job, economic and personal income growth

THE CASE FORCHANGE

One million jobs were lost in Michigan over the last decade

across virtually all industry sectors.

THE CASE FOR CHANGE

Michigan Lost 1M Jobs 2000-10

50% of U.S. Job Losses:

Michigan lost 1M of the 2M jobs lost inthe nation from 2000 through 2010.

This far surpassed the job lossesexperienced by any other state during this period.

Job Losses Across All Sectors

No One Sector Was the Cause:

Michigan under-performed the nation in 86% of the22 U.S. job categories from 2004-2009.

The auto sector only impacted ~20% job losses.

Michigan sectors that out-performed the U.S.average were: Community and Social Services,Personal Care and Services, and Agriculture.

MI > U.S.

U.S. < MI

Michigan Job Sector Growth vs. the Nation

14%

86%

SOURCE: SOC Job Category Data 2004-2009, BLS

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Weaker Economy

Economy Grew 2% Less than the Top Ten:

Michigan’s Per Capita Gross Domestic Product (GDP)grew 2% less than the average Top Ten state overthe past decade and less than nearly all peer states.

This is the primary factor behind stagnant wagesand job losses.

Lower Bond Rating

Higher Borrowing Costs:

Michigan spent more than it raised in revenues, wentdeeper into debt and drew down all its financialreserves in the 2000s resulting in a low bond rating.

This increases the cost of borrowing for allgovernments in Michigan and is a symbol of thestate’s fiscal health.

Poorer Residents

Poorer Relative to U.S.:

Michigan’s per capita income had been close to thenational average for nearly 40 years until decliningdramatically in the last decade.

Michigan’s per capita income has fallen to 39th dueto falling GDP over the past decade.

Michigan has grown smaller and poorer relative to other

states exacerbating the state’s economic decline.

THE IMPACT ON MICHIGAN

“Top Ten” states for job and economic growth: KS, MD, MT, NE, ND, SD, TX, VA, WA, WYSOURCE: Bureau of Economic Analysis; Moody’s Economy.com;

U.S. Census Bureau; McKinsey analysis

SOURCE: S&P

SOURCE: U.S. Bureau of Economic Analysis

THE IMPACT

ON MICHIGAN

Smaller State

Declining Population:

Michigan is the only state to lose population inthe last decade (0.6% decline).

This has resulted in Michigan becoming lessattractive to business due to a declining shareof the consumer market.

Losing Talent

Lack of Jobs Has Forced Talent to Leave:

Michigan’s high unemployment rate andeconomic decline across sectors has causedtalent to migrate out-of-state to where most ofthe jobs are — the Sun Belt states.

Past Ten Years Performance

Weak Ten Year Economic Track-Record:

Michigan’s combined ranking on per capitaGDP growth, per capita personal income leveland employment growth is last among statesover the past ten years.

This has placed Michigan far behind its U.S.and global economic competitors.

SOURCE: U.S. Census Bureau Population Estimates Program

SOURCE: Forbes based on U.S. Census data (2008)

SOURCE: 2011 BLM Benchmarking Report

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Seeking the Right Balance

The Cost/Value Equation:

No one factor determines where economicgrowth occurs. Taxes, talent availability andquality of life factors all matter.

Economic growth occurs in places that offer themost value relevant to the needs of specifictypes of businesses at costs commensurate withthe value offered.

Cost/Value Proposition Improving

Positives on Rise, Negatives Still High:

Michigan’s “cost/value” scorecard is getting better,but still isn’t strong enough to dramatically accelerategrowth.

Simply put, we need to increase the positiveattributes and lessen the negative drawbacks.

Michigan’s competitive position is improving, but still falls short when

compared to “Top Ten” states.

MICHIGAN’S COMPETITIVE POSITION

SOURCES: 2011 BLM Benchmarking Report & Anderson Economic Group Report for Brookings

MICHIGAN’S COM

PETITIVEPOSITION

Strong Talent Production

Competitive Supply of Highly EducatedGraduates:

Future workplace demands will requireincreasing the number of educated workers.

Current levels of college graduates makeMichigan competitive with most states.

Strong Technical Talent Base

Highly Competitive Supply of Technical Talent:

Michigan’s manufacturing and life sciences heritagehas resulted in one of the highest concentrations oftechnical talent, both with advanced degrees andtechnical certificates, in the nation.

Strong Innovator

Innovation Outcomes Rank Favorably:

Michigan’s university and industry-basedinnovation outcomes rank favorable against toptier U.S. competitor regions and is a driver oflong-term growth.

SOURCE: National Science Foundation

SOURCE: 2010 URC Economic Impact Report, * State Science & Technology Institute

1 States with the same score received the same rank2 “Top Ten” states for job and economic growth: KS, MD, MT, NE, ND, SD, TX, VA, WA, WY

SOURCE: U.S. Department of Education, National Center for Education Statistics, Integrated Postsecondary Education Data System (IPEDS);

U.S. Census Bureau; Moody’s Economy.com

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Higher Business Costs

Total Business Costs Greater Than National Average:

Companies pay on average 3% more in “totalbusiness costs” in Michigan than the U.S. average.

Costs can be as much as 19% above the“Top Ten” states and peers we most oftencompete against for jobs & investment.

“Total business costs” include labor, taxes,energy & state/local taxes.

Geographic Location

Location Advantages:

Michigan has three unique geographicadvantages that could be leveraged to increaseexports and attract foreign direct investment:

• One of largest U.S. air hubs to Asia

• Center link of NAFTA highway

• Closest entry to Midwest from Halifax port

Business Taxes Higher Than Competitors

Tax Climate Improving, But Worse Than Competitors:

New corporate income tax expected to improve Michigan to 22nd best ranking.

Property taxes still high due to personal property tax — a tax not assessed by most states Michigan competes with.

UI taxes expected to increase to repay federal debt.

1 Consists of 75% labor costs, 15% energy, 10% state/local taxes2 States with the same score received the same rank

3 “Top Ten” states for job and economic growth: KS, MD, MT, NE, ND, SD, TX, VA, WA, WYSOURCE: North American Business Cost Review; Moody's Economy.com

1. Includes both real and personal property tax in Michigan2. Rankings do not reflect recent changes to Michigan Unemployment Insurance

requirements or changes made to Michigan’s corporate and individual income taxesSOURCE: 2011 BLM Benchmarking Report

MICHIGAN’S COM

PETITIVEPOSITION

Complex Regulatory Climate

Michigan Regulatory Climate Ranked #43:

Regulatory requirements in Michigan are oftengreater than those of other states and thecompliance process can be more difficult dueto the multiplicity of jurisdictions and ease ofdoing business.

Less Educated Workforce

Education Attainment Less Than Top Ten States:

Michigan is competitive in the amount of talentit produces, ranking 21st in the number of totalcollege degrees conferred per capita, butMichigan only ranks 31st in the percent of thepopulation over age 25 with a bachelor’sdegree or above.

Poor Infrastructure

Infrastructure Impedes Global Competitiveness:

The quality and capacity of Michigan’s physicalinfrastructure limits the state’s ability to leverage astrong geographic location to increase exports andexpand foreign direct investment in a globaleconomy.

SOURCE: Pacific Research

SOURCE: NCHEMS

1. BTS, 2. aapa-ports.org, 3. FAA.com, 4. NTIA, 5. Reason Foundation (Comb. Rural/urban), 6. Detroit Regional Chamber

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Global Competition Escalating

Michigan Competes in a Global Economy:

The fastest economic growth is expected to continue to occur in emerging global markets.

Michigan’s ability to accelerate economic growth is tied to the state’s ability to compete in the global economy.

Less Attractive Urban Centers

Michigan Cities Rank Low On Urban Vitality:

Michigan cities generally rank low on most“best cities to work, live or grow a business”lists.

Low rankings reflect a combination of fact andperception-based issues that detract fromMichigan’s image.

Michigan must accelerate efforts to strengthen its cost/value equation

in the face of escalating global competition

SOURCE: The Conference Board

PROGRESS

Michigan’s economic turnaround has begun, but it is at an early stage.

PROGRESS

Lower Unemployment

Michigan Has 2nd Best Recovery ofAny State:

Michigan’s unemployment rate droppedmore than any other state, exceptNevada, over the past year.

This improvement was nearly three timesfaster than the national recovery.

Higher Gross Domestic Product (GSP)

2010 – Above Average Increase in GDP:

Michigan GDP increased at a faster rate thanmost peer states and nearly as fast as “Top Ten”states in 2010.

The increase put Michigan above the nationalaverage for GDP growth for the first time in adecade.

The increase was largely due to economicrecovery in the automotive and manufacturingsectors.

SOURCE: BLS Seasonally Adjusted November Unemployment Rate


1 “Top Ten” states for job and economic growth: KS, MD, MT, NE, ND, SD, TN, TX, WA, WY

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Higher Per Capita Income

2010 - 7th Best Increase in Income:

Michigan’s per capita personal income increased bynearly 4% in 2010 which increased the state’s ranking from 39th to 38th.

The increase was nearly one and a half times the national average.

SOURCE: U.S. Bureau of Economic Analysis

2012 MICHIGAN TURNAROUND

PLAN OVERVIEW

The Goal

“Top Ten” State for Job &Economic Growth =

Higher Personal Income forMichigan Residents

Characteristics of Top Ten States

Top ten states generallyhave several commoncharacteristics that sustainhealthy economic growth.

The goal is getting Michigan to become a “Top Ten” state for job, economic and personal

income growth through a plan based on facts.

2012 MICHIGAN TURNAROUND PLAN OVERVIEW

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Potential Results of GrowingLike a Top Ten State

The Six Step Michigan Turnaround Plan

1. Based on Michigan accelerating per capitaincome growth to match the rate of #10 state

Mississippi whose rate was 44%. 2. Employment growth is accelerated to match the rate of Hawaii which accelerated at 6.4%.

Sources: US Bureau of Economic Analysis and BLS

ORIGINAL MTP GOALS AND RECENT PROGRESS

3 Public-private revenue estimating

council to improve forecasting

3 Quarterly survey of Michigan

businesses to improve forecasting

3 Multi-year financial & budget plans

to improve fiscal discipline

3 Citizen-friendly balance sheet to

improve transparency

3 Zero-based budgeting or other

system to increase results

3 No new programs unless others

eliminated or revenues grow

• Strategic plan to set priorities

• Require fiscal notes to identify

compliance and other costs

WHERE WE STAND

• 19 states adopt biennial budgets¹

• Revenue estimates are more

volatile in changing economy²

• Michigan, as a relatively poor

state, must set fiscal priorities

more than the average state

• Increasing Michigan’s bond rating

from AA- to AAA would save

interest costs

• State borrowing has increased

over three times the growth of

personal income in the past

twenty years and now exceeds

annual state revenues³

• State unfunded pension liabilities

exceed $18B³

• Michigan’s unemployment

insurance debt was retired

through an innovative bond

issuance.

2012 MTP GOALS

• Set clear spending priorities

- Adopt a strategic plan setting

goals & expected outcomes

- Adopt performance-based

budgeting with ROI

measures

• “Price” the cost to complywith proposed legislation

- Adopt fiscal notes for all

legislation

• Memorialize sound fiscalmanagement practices inlegislation or policy(e.g., timely adoption of a

structurally-balanced budget,

two-year budget plan, citizen-

friendly balance sheet)

• Reduce debt levels toachieve AAA bond rating

3 = Accomplished or significant progress• = Not accomplished

¹ NCSL² Pew Center for the States³ 2011 Citizen’s Guide to MI Fiscal Health


PLAN OVERVIEW

Step 1: Responsibly Manage Finances

A scorecard of five key metrics developed byBusiness Leaders for Michigan to assess theoverall condition of state and local finances.All show positive trends in 2011, but operatingreserves, pension obligations and overall debtlevels continue to need further attention.

*Arrows indicate positive or negative trendsColors indicate whether the metric has been fully achieved

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Step 2: Efficiently & Effectively Provide Public Services

Significant progress has been made to reducethe cost of government in Michigan.

But more work is needed to reduce costs andincrease productivity to improve the state’scompetitiveness and reflect its relatively low percapita income.

ALEC (NAEP SCORES), 2. McKinsey,3. Anderson Economic Group, 4. U.S. Census

Efficiently & Effectively Provide State Services


3 Reduce state workforce

3 Enact corrections management &

sentencing reforms

3 Reduce optional services that

exceed federal standards

3 Eliminate state programs that

duplicate or overlap federal

standards

3 Benchmark and increase state

employee health care premium

contributions to the average of

U.S. state employees or all

Michigan employees

• Benchmark and freeze pay for

state employees to the U.S.

average for state employees

WHERE WE STAND

• Average total compensation for

state employees was $22,000

more than the private sector

average in Michigan in 2010¹

• Michigan state employees total

compensation is 14% above

the U.S. median state and 22%

above Indiana²

• Michigan’s incarceration rate is

51% higher and our prisoners stay

48% longer than the Great Lakes

average. Michigan spends 30%

more to house prisoners than

Ohio and 80% more than Texas²

• Government productivity gains in

the U.S. have under-performed

most other sectors for twenty

years3

2012 MTP GOALS

• Improve the cost and productivityof the state workforce

- Adopt a total compensationsystem that enables the state tocompete for talent in highlycompetitive fields and rewardsperformance at a costcomparable to the average state

• Reduce corrections costs tothe Great Lakes average

• Improve the efficiency of stategovernment

- Invest in programs that have aproven track-record of reducinglong-term costs (e.g., prisonerre-entry, home health care)

- Adopt best practices to provideself-directed citizen & businesstransactions through the use oftechnology

¹ BEA Comp. of Employees by NAICS² U.S. Census3 McKinsey


Efficiently & Effectively Provide School Services


PLAN OVERVIEW

¹ NAEP & AEG analysis² National Education Association3 U.S. Census4 McKinsey



3 Benchmark and increase public

school employee health care

premium contributions to the

average of U.S. state employees

for all Michigan employees

3 Provide incentives for local district

cost-sharing

3 Retain demanding graduating

standards

3 Allow an unlimited number of

charter schools, especially in

under-performing districts

• Fully transition teachers to a

defined contribution retirement

system

WHERE WE STAND

• Michigan student test scores

rank at (8th grade reading =

32nd) or below (8th grade math

= 37th) the national average

while per capita spending ranks

above average (8th)1

• Average annual salary costs for

public school teachers was

$3,370 more (6% higher) than

the average of U.S. public school

teachers in 20092

• Michigan has more than 500

school districts – 6th highest in

the U.S.3

• The education sector’s

productivity has declined for 20

years in the U.S.4

2012 MTP GOALS

• Improve the return on investmentfrom the 0-12 education system

- Accelerate the consolidation of

schools where appropriate and the

sharing of school services to direct

more resources to student learning

- Fully transition teachers to a defined

contribution retirement system

- Provide access to quality early

childhood education

- Maintain rigorous standards in

reading, math and science

- Maximize the time students

spend on academic learning

- Attract, train and retain

excellent teachers

- Attract and train excellent

school leaders

- Measure and reward schools,

teachers and school leaders

that perform at a high level

- Improve the collection and

use of data

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Efficiently & Effectively Provide Local Services


3 Encourage & enable local

government service sharing

3 Modify or eliminate binding

arbitration for municipal police &

fire workers

• Adopt best management practices

3 Align local employee benefits to

average of all Michigan employees

• Adopt competitive tax & regulatory

standards

WHERE WE STAND

• Michigan has 2,800 units of local

government – 12th highest in the

U.S.¹

• Michigan ranks among the top ten

states in the number of elected

officials with over 17,000¹

• Local government boundaries

don’t align with regional

economies

• State and federal program

boundaries don’t align with

regional economies (e.g., Michigan

has 25 workforce development,

17 adult education, 14 planning

and 19 arts regions none of

which align with each other)²

2012 MTP GOALS

Advocate state government enableimprovements in local servicedelivery by:

• Providing incentives &disincentives in all state programsthat recognize local servicesharing

• Aligning federal & state programboundaries with regionaleconomies

• Accelerating efforts to consolidatelocal administrative services andincrease regional service delivery

Advocate local governments adoptbest practices and “fix the basics”by ensuring:

• Competitive tax & regulatorystandards

• Sound fiscal managementpractices

• Strong ethics standards

• Effective public safety

• Results-oriented redevelopmentstrategies

• Cost-effective, reliable basicservices

• Professional communicationsthat improve perceptions

• Support for regional solutions

¹ U.S. Census² WMSA


Step 3: Create a Competitive Business Climate

Companies compare the “total cost of doing business” against a region’s assets when evaluating site location decisions.

Michigan ranks average to below average on mostsite location factors.

State assets fail to offset our higher cost structure.


PLAN OVERVIEW



3 Reform the Michigan Business Tax

to make Michigan more competitive

3 Create a regulatory report card

3 Require regulations to demonstrate

cost/benefit analysis

3 Annually benchmark Michigan’s

competitiveness

3 Reform UI system

• Eliminate the personal property tax

• Prohibit state regulations that

exceed federal standards

WHERE WE STAND

• Michigan’s corporate tax burden isprojected to rank 22nd, up from 48th,with the new corporate income tax¹

• Michigan’s overall property taxburden ranks 32nd2

• Michigan’s UI tax burden ranks 45th2

• Top site location factors includetotal costs, workforce skills, taxes,transportation infrastructure, utilitycosts & infrastructure, regulatoryenvironment, economicdevelopment effort & incentives,and innovation resources2

• Michigan has many barriers precludinga cohesive culture toward business,such as having the 12th highestnumber of governmental units3

• Michigan’s business climate imageranks 48th2 and is impacted by theabove conditions

• Michigan ranks in the 3rd quartilefor the availability of risk capital4

2012 MTP GOALS

• Benchmark Michigan’s businesscosts to Top Ten states

- Eliminate the personal property tax

• Create a responsive,collaborative regulatory system

- Deliver responsive customerservice

- Align Michigan’s regulatoryrequirements with nationalstandards

- Require regulations todemonstrate cost/benefit analysis

• Provide a seamless, one-stopprocess for business growth

- Align state & local sitedevelopment & businessregulations

- Create a modern, cost-effectiveincentives program

• Strengthen Michigan’sworkforce

- Foster a frictionless workforceenvironment

- Match education & trainingsupply with workforce demand

- Retain & attract skilledimmigrant, mid-career & youngtalent

• Increase capital availability

¹ Tax Foundation² BLM Benchmarking Report³ U.S. Census4 State Science and Technology Index (2010)


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Step 4: Strategically Invest for FutureGrowth (Higher Education)

60% of Michigan workers will need Associate’s degree equivalent or more by 2025.

Michigan will not meet that need if currenttrends continue without significant newinvestments and approaches to highereducation.

SOURCE: Lumina Foundation


• Make Michigan a Top Ten state for

higher education funding

• Rationalize the management of 28

community colleges & 15

university campuses to realize

greater administrative efficiency

WHERE WE STAND

• 62% of Michigan jobs by 2018

will require post-secondary

education – 39% of Michigan’s

current workforce has post-

secondary education¹

• Michigan ranks 31st in post-

secondary attainment²

• Michigan ranks 39th in higher

education state support per

student³

• College affordability in Michigan

is low — Michigan has the 10th

highest tuition rate in the

nation²,³

• Higher education needs to

increase degree productivity by

23% on average to meet future

job requirements⁴

2012 MTP GOALS

• Increase the percent of theMichigan workforce withpost-HS education:

- By 2022, fund Michigan’suniversities at a levelcomparable to Top Ten statesif they meet, exceed or areprogressing towardperformance metrics

- Adopt outcome-basedperformance metrics to fundhigher education that addressquality, productivity andefficiency, affordability andaccess, and economic impact

- Publish an on-lineperformance dashboard

- Grow universities’ contributionto Michigan’s economy andgrow our talent pool by:

• Increasing out-of-stateenrollment to at least theaverage of peers withoutreducing access forin-state students

• Establishing an internationaltuition rate similar to othernations

- Increase public awareness ofthe benefits of higher education

¹ Center on Education & the Workforce² NCHEMS³ SHEEO⁴ McKinsey



PLAN OVERVIEW

¹ Reason Foundation² FHWA ³ Detroit Regional Chamber4 FAA.gov



3 Advocate for incentives and provide

support for the Detroit Region

Aerotropolis

• Adopt new funding formulas to

support a Top Ten transportation

infrastructure

WHERE WE STAND

• Michigan ranks #38 in the U.S.

in urban interstate highway

condition & #47 in urban

congestion¹

• State & local highway spending

in Michigan ranks #48 in the

U.S. per capita²

• Michigan has the 15th busiest

airport in the U.S. (Detroit Metro)4

• Michigan has the 38th busiest air

cargo airport in the U.S. (Detroit

Metro)4

• Detroit is the busiest land border

crossing in the U.S.³

2012 MTP GOALS

• Connect Michigan with the globaleconomy through strategicinvestments in infrastructure

- Build the New International Trade

Crossing

- Expand international rail freight

access

- Develop the Aerotropolis

- Develop an inter-modal freight

facility

- Increase bandwidth capacity and

access

- Fund investments that improve

Michigan’s highway system to

Top Ten quality

Step 4: Strategically Invest for Future Growth(Infrastructure)

Strategic investments could leverage Michigan’sunique geographic location to accelerate job growth.

Growth in the logistics sector and development ofthe Detroit Region Aerotropolis could create asmany as 180,000 new jobs.1

1. McKinsey Analysis

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Step 5: Accelerate the EconomicGrowth of Cities & Metros

Just as in the nation as a whole, Michiganmetros disproportionately drive theeconomy.

Accelerating the growth of metros is thebest way to accelerate the growth of boththe state as well as the cities that arelocated within them.

*Ann Arbor, Battle Creek, Bay City, Flint, Holland, Jackson, Kalamazoo, Lansing, Monroe, Muskegon, Niles, Saginaw SOURCE: Brookings, “Michigan’s Urban & Metropolitan Strategy”


3 Develop an urban agenda to

revitalize central cities

WHERE WE STAND

• From 1980-2009:¹

- 2 of 14 Michigan metrosexceeded the U.S. average foreconomic output

- 3 of 14 Michigan metrosexceeded the U.S. average forjob growth

- 2 of 14 Michigan metrosperformed better than theirpeers on economic growth

• Michigan metros are more

productive, export-oriented and

talent-rich than the average U.S.

metros¹

• Michigan metros have many

strengths to accelerate economic

growth:¹

- Drive 85% of the state’s exports

- Home to 90% of science andengineering employment

- Home to 85% of population withpost-secondary degree

2012 MTP GOALS

• Accelerate the redevelopmentof Michigan’s largest cities &metros with special emphasison Detroit:

- Support regional strategiesdesigned to strengthen the linkbetween innovation andmanufacturing to increaseexports and attract globalinvestments

- Support strong regional systemsto train existing workers andwelcome new ones to fueleconomic growth

- Make targeted investments thatleverage distinct assets in urbanand metropolitan areas totransform regional economies

• Support metros’ efforts toimprove delivery of basicpublic services (see Step 2)


¹ SOURCE: Brookings, “Michigan’s Urban &Metropolitan Strategy”


PLAN OVERVIEW3 = Accomplished or significant progress• = Not accomplished


3 Support job growth in all sectors

3 Grow the entrepreneurial

infrastructure

3 Develop strategies to grow broad

business sectors that leverage key

assets

3 Strengthen university-business

collaboration

WHERE WE STAND

• Michigan must dramatically

accelerate performance to

achieve Top Ten job, economic

and personal income growth

• Actions taken through Steps 1-5

of the Michigan Turnaround Plan

lay the foundation for Michigan

to accelerate growth

• Michigan lacks a consistent,

long-term strategy to leverage

key assets that transcend

election cycles

• The link between

entrepreneurship, innovation and

manufacturing will be a major

driver of future growth

• The nation and world are largely

unaware of the progress

Michigan has taken to rebuild its

economy

2012 MTP GOALS

• Champion strategies that leverageMichigan’s unique assets toaccelerate long-term economicgrowth:

- Global Engineering Village

- Gateway to the Midwest

- Higher Education Marketplace

- Natural Resource Economy

- Global Center for Mobility

- Life Sciences Hub

• Build support among keystakeholders for growthstrategies that transcend electioncycles

• Support a strong foundation ofentrepreneurship, innovation andmanufacturing

• Raise awareness of progressbeing made toward building aNew Michigan

Step 6: Leverage Assets to Grow the New Michigan

Steps 1 through 5 of the Michigan TurnaroundPlan lay the foundation for building a strongeconomy. Step 6 identifies the state’s mostsignificant existing assets that can beleveraged to accelerate growth and become aTop Ten state for job, economic and personalincome growth.

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Step 6: Leverage Assets to Grow the New Michigan

1

Responsibly

Manage

Finances

• Set clear spending

priorities

• “Price” the cost to

comply with

proposed

legislation

• Memorialize sound

fiscal management

practices in

legislation or policy

• Reduce debt levels

to achieve AAA

bond rating

2

Effectively &

Efficiently

Provide Public

Services

• Improve the cost &

productivity of the

state workforce

• Reduce corrections

cost to the Great

Lakes average

• Improve the

efficiency of state

government

• Improve return on

investment from the

0-12 education

system

• Advocate state

government enable

improvements in

local service delivery

• Advocate local

governments adopt

best practices and

“fix the basics”

3

Create a

Competitive

Business

Climate

• Benchmark

Michigan’s business

costs to Top Ten

states

• Create a responsive,

collaborative

regulatory system

• Provide a seamless,

one-stop process for

business growth

• Strengthen

Michigan’s

workforce

• Increase capital

availability

4

Strategically

Invest for

Future

Growth

• Increase the

percentage of

the Michigan

workforce with

post-HS education

• Connect Michigan

with the global

economy through

strategic

investments in

infrastructure

5

Accelerate

the Economic

Growth of

Cities & Metros

• Accelerate the

redevelopment of

Michigan’s largest

cities & metros

with special

emphasis on

Detroit

• Improve delivery of

local services by

advocating state

government enable

improvements and

local government

adopt best

practices and “fix

the basics”

6

Leverage

Assets to Grow

the New

Michigan

• Champion strategies

that leverage

Michigan’s unique

assets to accelerate

long-term economic

growth

• Build support among

key stakeholders for

growth strategies

that transcend

political terms

• Support a strong

foundation of

entrepreneurism,

innovation and

manufacturing

• Raise awareness

of progress being

made toward

building a

New Michigan

Laying the foundation for building a New Michigan


PLAN OVERVIEW

ENGINEERINGTALENT

Global Engineering

Village

Brand the

engineering

sector

•

Grow engineering

education

capacity

•

Grow

engineering

firms

Potential w

ays to le

verage

the

ass

ets:

Oppo

rtun

ities:

Asse

ts:

GEOGRAPHICLOCATION

Gateway to the

Midwest

Consolidate

logistics base into

Michigan

•

Scale the

Aerotropolis

•

Invest in strategic

trade-related

infrastructure

(e.g., bridge,

tunnel, rail)

HIGHER EDUCATIONSYSTEM

HigherEducation

Marketplace

Strengthen quality,

affordability,

productivity &

economic impact•

Grow university

enrollment•

Grow industry &

university

funded R&D•

Grow commerciali-

zation of R&D

NATURAL RESOURCES

NaturalResourcesEconomy

Grow agricultural

processing and

exports

•

Grow leisure

tourism

•

Lead in alternative

energy

technologies

AUTOMOTIVEINDUSTRY

Global Center ofMobility

Lead in

sustainable mobility•

Lead in multi-

modal systems•

Lead in vehicle/

infrastructure

technology to

improve road safety•

Grow the auto

industry

HEALTH & MEDICALEXPERTISE

Life Sciences

Hub

Create a

Hub for

bio-pharmaceutical

R&D

•

Become the Center

for research,

testing &

medical labs

•

Grow medical

tourism

Distinctive Michigan assets that can grow a New Michigan

Strong base of entrepreneurism, innovation and manufacturing

newmichigan

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Where We Should Be

If Michigan had grown like a Top Ten state since 2000, we would have…

SOURCE: AEG Analysis of BEA & BLS Data

Where We Could Be

Michigan can once again be a “Top Ten” state for job, economic and personal income growth.

The first five steps of the Michigan Turnaround Plan allow us to undertake an important 6th step —leveraging Michigan’s unique assets to grow the New Michigan.

If we capitalize on our most significant existing assets, we have the potential to increase our current growth projections by as much as 40 percent by 2020. We can also add up to half a million jobs and grow the personal income of each Michigan resident by as much as $18,000 during the same time period.

Turn this booklet around to see what the New Michigan can look like.

newmichiganDistinctive Michigan assets that can grow a New Michigan

LAYING THE FOUNDATION TO BUILD A NEW MICHIGAN

newmichigan Distinctive Michigan assets that can grow a New Michigan

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2 Letter from the Chairman and CEO

3 Executive Summary

5 Developing The New Michigan

9 A New Michigan: One Vision, Six Opportunities

11 Global Engineering Village

13 Gateway to the Midwest

15 Higher Education Marketplace

17 Natural Resources Economy

19 Global Center of Mobility

11 Life Sciences Hub

23 Conclusion

25 Business Leaders for Michigan Board of Directors

Note: You are starting at Step 6 of the Michigan Turnaround Plan.

Flip the book to read about the first five steps.

The people of Michigan have been struggling with challenging economic conditions for sometime. We are the only state in the union to have lost population during the 21st century and oneof the few to have experienced negative economic growth. Those who remain here struggle withslower than average job and personal income growth.

These challenges have acted as a unifying, motivating force for change. Business Leaders forMichigan is collectively and singularly dedicated to turning Michigan’s circumstances around bycapitalizing on the existing natural and human resources we possess, including:

• A strong research and development hub, co-located with the manufacturing facilitiesnecessary to produce what we invent;

• An exceptional talent pool, including researchers, engineers, and technically-trained workers; and

• A unique geographic location that is rich with natural resources and the logistical accessnecessary to bring goods to market worldwide.

Business Leaders for Michigan believes that by leveraging these and other assets, Michigan canfully take advantage of the solid economic foundation laid by the first five steps of the MichiganTurnaround Plan to accelerate economic growth. We call this a “New Michigan” strategy and itidentifies six areas, each of which promises tremendous opportunities for success. Takentogether with the first five steps of the Michigan Turnaround Plan, this “New Michigan” strategycan propel Michigan into becoming a Top Ten state for economic, job and personal income growth.

Specifically, we forecast that Michigan has the potential to increase our current growth projectionsby as much as 40 percent by 2020. We can also add up to half a million jobs and grow the personalincome of each Michigan resident by as much as $18,000 during the same time period.

Our plans are thoroughly researched, and — most important of all — they are attainable. We are inparticular indebted to McKinsey & Company for their invaluable research assistance in preparing thisdocument. By working together, we can right Michigan’s economic ship and realize our full potential.

Let us show you what Michigan can become — and how together we can make it happen.

Sincerely,

James B. Nicholson Doug RothwellChair of the Board President & CEO

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In 2009, Business Leaders for Michigan (BLM) unveiledthe Michigan Turnaround Plan, an aggressive agenda tomake Michigan a Top Ten State for job and economicgrowth.

The Plan included five steps for a better Michigan:

• Changing the way we manage our finances

• Right-sizing and enacting structural budget reforms

• Getting Michigan competitive to attract and retainjobs

• Making investments that create a great jobenvironment

• Accelerating job growth through innovation andentrepreneurship

We have worked closely with government, civic andbusiness leaders to effect meaningful advancement ofeach Michigan Turnaround Plan objective. Citizens andstakeholders have rallied around the plan, manycomponents of which are now in place. We areencouraged that significant progress is being made inlaying the building blocks for a more durable future.

Now that our foundation is more solid, it is time to adda sixth step to the Plan – the identification of driversand strategies that would allow us to begintransitioning to the “New Michigan” we wish to see.This will require our state to have a shared vision forthe future, one that enables us to prioritize the use oflimited resources and sustains efforts beyond electioncycles.

The objective of this sixth step of the MichiganTurnaround Plan is to provide a ten year vision for growing

the “New Michigan” economy. Within this objective, webuilt a series of opportunities/drivers, each of which:

• Has the potential to move Michigan to top 10performance on output metrics including GDPgrowth, unemployment rate, and GDP per capita

• Generates excitement among stakeholders,government, and the Michigan population at largethrough development of opportunities which:

- Leverage unique Michigan strengths

- Are compelling and “fit” what Michigan is

- Are powerful game changers if executed properly

• Is informed, but not constrained, by global mega-trends

• Includes tangible near-term actions whichdemonstrate early commitment and show tractionagainst the new vision

To support our thinking, we gathered an array of input —from BLM members, policy leaders, economic analysts,and others — and collected a wealth of data to supportsound thinking about what Michigan can become. Weevaluated case studies and turnaround models fromsimilarly situated economies across the globe, to learnhow we might make their success stories our own.McKinsey & Company played a significant role in thiseffort.

This work identified six distinctive assets that can helpMichigan dramatically accelerate growth if we focusour efforts and resources. Each of these opportunitiesis grounded in careful, fact-based analysis andaccounts for available resources, markets, and expertise.

Executive Summary

EXECUTIVE SUMM

ARY

The six assets we believe have the greatest potential toaccelerate Michigan’s growth are the following:

• Grow and brand our industrial, production and talent capacity to develop a reputation as a Global Engineering Village

• Capitalize on our strategic location and available resources to become the premierGateway to the Midwest

• Invest in a Higher Education Marketplace thatboosts the state’s talent base and leverages itsinnovative strengths

• Take advantage of Michigan’s natural resources togrow a Natural Resource Economy, thatsustainably drives exports

• Amplify our automotive and manufacturing expertiseto become a Global Center of Mobility

• Develop a Life Sciences Hub based on our robusthealth, medical and bio-pharmaceutical capabilities

While there are other areas for growth beyond these sixopportunities, we believe these are best positioned todeliver significant results. They offer the bestopportunities for growing good paying jobs and changingMichigan’s economy in ways that are meaningful andlasting for the people of our great state.

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Michigan’s legacy as the powerhouse ofAmerican industry has suffered significantly

over the last decade or so. Michigan’s economy has

shrunk. The state has created fewer jobs than any other state

since 2000, and per capita income fell to the bottom quartile

of all states. We are the only state in the union to have lost

population in the 21st century.

Yet Michigan retains valuable natural and human assets that provide an unprecedented

opportunity for a fundamental turnaround. Building on recent policy changes consistent

with the proposals outlined in the Michigan Turnaround Plan, now is the time to leverage

these assets to accelerate growth. We have a talented labor pool and strong flow of

university graduates eager for new work, underutilized facilities primed for new activity,

and a strong tradition of innovation and entrepreneurism ready to drive renewal. The

conditions at hand, in fact, offer us both the motivation and the means to craft a future

that puts Michigan at the center of trends that will shape the economic development of

our world in the decades to come.

Challenges and opportunities for driving growth

Developing The New Michigan

DEVELOPING THE NEW M

ICHIGAN

What follows is a strategy to leverage the environmentcreated by the first five steps of the MichiganTurnaround Plan. It is a framework to launch our stateon a new path in the next 10 years by focusing onconcrete opportunities in six specific areas. Theseopportunities already have foundations in place uponwhich to build. Focusing our limited resources, timeand energy on these unique assets can make Michiganone of the ten fastest growing states in the U.S., bring

our unemployment rate down below the nationalaverage, and push personal income to new levels. Ourplan is no recital of blue-sky aspirations. It is groundedin a sober analysis of Michigan’s specific assets andhow to make them count for more in a rapidly changingworld economy as well as leveraging externalperspectives on the major economic trends shaping thedecade ahead. That said, we invite dialogue with allstakeholders and citizens of Michigan to further shapethis renewal and growth strategy for Michigan.

Strengths to build on

Michigan has three overarching strengths it can buildon to accelerate economic growth and reassert itsleadership in the world.

• A hub of innovation and production• People who translate ideas into solutions• A location with abundant natural resources that canserve the world

A hub of innovation and production

Most experts recognize that the developed nations ofthe world will have to innovate their way to futuregrowth by producing goods and services that increaseexports and attract foreign direct investment. But it isbecoming increasingly clear that our ability to innovateis tied to our capacity to produce the products we aretrying to improve or invent, and to nurture the talentthat drives product development. Whether it is thenext-generation automobile or a new softwareapplication, design and development need to occur inclose proximity to one other to realize the greatestimpact on a region’s economic growth. And this isprecisely Michigan’s strategic advantage for the future –the co-location of strong innovation and manufacturingassets.

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Many of our strengths have their genesis, notsurprisingly, in our manufacturing heritage and theautomotive industry. For more than a century, Michiganhas been the undisputed center of the 20th century'smost transformative industry. Our state still contributesover a quarter of the output of the entire U.S. automotiveindustry, more than twice as much as its nearestcompetitor. But Michigan’s leadership in manufacturingextends far beyond the automotive industry. The state isalso the home of the office furniture industry, the world’slargest chemical company and some of the world’slargest food manufacturers.

Co-located with that strong manufacturing base is one ofthe nation’s largest concentrations of research anddevelopment. Our state is a hub of invention, rankingfourth nationally in industry-sponsored R&D. It’s noaccident that the proportion of graduates in scientific,technical, engineering and medical disciplines is 18percent higher in Michigan universities than it is in theU.S. at large. Our research universities rank sixth in thenation in terms of R&D expenditure per student. Thateducational edge surely contributes to the fact thatMichigan is able to generate a high level of innovationeven in the current industrial scenario: per capita, thestate registers 20 percent more patents than the U.S.average. And by broadening our industrial base along thelines we propose, we can turn that proclivity for innovationinto a far more efficient engine for economic growth byfocusing on both adjacent market opportunities andstrengthening our position in market areas where wealready occupy a strong leadership position.

People who translate ideas into solutions

The co-location of innovation and production has letMichigan develop a talent base that is exceptionallyskilled at translating ideas into practical goods andservices. Our state has deep competencies in fields likedesign, safety, and supply-chain management that arefundamental to taking an idea from the laboratory to thecustomer’s home or business at an affordable cost.

Expertise, not just ideas, is increasingly what drivesgrowth. And we have an expertise in the discipline thatwill be at the center of driving future productivity gains –engineering. Michigan has more engineers per capitathan any place else in America, and that expertise cutsacross all functional disciplines, not just in theautomotive industry, but also in fields like naturalresources and logistics.

Michigan’s talent pool extends beyond the researchersthat create the ideas and the engineers that innovatepractical ways to apply them. We also have one of the

DEVELOPING THE NEW M

ICHIGAN

nation’s greatest concentrations of technically-trainedworkers, who can translate these innovations intoeveryday products and solutions. Our expertise in themedical and health arena is also important as growthin the healthcare and the related medical services isfar outstripping that of the economy as a whole.Michigan’s unique combination of research,engineering and technical talent gives it the foundationto solve many of the world’s great challenges.

A location with abundant natural resourcesthat can serve the world

Michigan’s geographic location and natural assetsbestow unique advantages for an economicrenaissance. Speed in delivering goods and serviceswill become increasingly important in a globalmarketplace. For example, just-in-time delivery frompoint of production to end-destination consumer willgrow exponentially, increasing the need for globallogistics solutions. Michigan provides the most directroute to the largest American markets from new andexpanded Canadian deep water ports — the cheapestand most carbon-efficient conduit for bulk trade to andfrom Europe, the Middle East and Africa. Detroit alsohas co-located passenger hub and cargo airports withthe fifth-largest runway capacity in the U.S. and one ofthe shortest routes to Asian growth markets. Thatcapacity is underutilized now, and can be furtherexpanded to make Michigan the primary gateway tothe Midwest. When combined with the state’s highpenetration by the interstate highway system andservice from four of the six major national railroadnetworks, Michigan is well positioned to deliver anddistribute the goods and services it produces.

Our state still has sizable potential to gain from the richstore of natural resources on its territory, too. More andmore demand for resources is outstripping supply.Places in the world that have these resources will be ina position to accelerate their economies if they find

sustainable ways to utilize them. Michigan can be oneof those places. With the world’s greatest source ofpure freshwater, a large supply of precious minerals,large deposits of shale oil and expertise in alternativeenergy solutions, Michigan can support the growth ofinnovation and manufacturing like few other places.

Our natural resources also give us the ability to growour tourism industry so that it better parallels trends inthe broader marketplace. Our agricultural know-howcan help us fulfill another of the world’s growing needs:food production. Our farming traditions married to ourengineering expertise can help us seize advantages inthe rapidly growing industry of precision and high-yieldagriculture.

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ONE VISION, SIX OPPORTUNITIES

A NEW MICHIGAN:

In this document, we lay out how Michigan’s fundamentalassets — described on the following page — can beleveraged to accelerate economic growth by seizingupon six high-potential growth opportunities. Like therest of the Michigan Turnaround Plan, these opportunitieswere identified through extensive research and arebased on facts. They are the opportunities we foundwould have the greatest impact in a ten year time periodto accelerate growth, but they do not represent anexhaustive list. They merely constitute some of the bestpossibilities. We outline how these opportunities might berealized in the sections that follow, and provide moredetails at businessleadersformichigan.com.

We also identify how leveraging these six opportunitiesmight impact our job, economic and personal income

growth. For example, if all six opportunities were fullyrealized, based on current economic models, Michigancould outpace our current growth projections by as muchas 40 percent and increase the per capita annual incomeof our residents by as much as $18,000 by 2020. Thesechanges would vault our state into the top of the class interms of growth and add as many as half a million newjobs in that period. These projections can’t anticipatehow well Michigan will seize each opportunity or howglobal economic conditions might change during thenext decade. But they do identify the economic potentialof these opportunities and their power in dramaticallyreversing a decade’s long downward trend into a brighterfuture in the decades beyond.

But no one is going to give us that growth; we have toearn it. We have to recognize that we compete in aglobal marketplace and embrace leadership, policies andattitudes that accelerate growth. We have to focus ourlimited resources on building the infrastructure andassets that will contribute most to growth. We have toforge a sense of common purpose among government,the private sector, and the institutions and organizationsthat bolster our economic life. And we have to remainvigilant so we recognize changing economic conditionsand seize new opportunities as they arise.

The all-important point is that new levels of growth areeminently achievable for Michigan, but we can increasethe odds and accelerate the pace of achievement if wetake advantage of some unique opportunities. It can bedone, and here are six ways to make it happen.

If all six opportunitieswere fully realized,

Michigan could increaseper capita annual

income by as much as$18,000 by 2020 and

add as many as half amillion new jobs.

Source: AEG analysis, US Census, Statistiska Centralbyra (SCB), BLM higher education economic impact analysis, MGI

ENGINEERINGTALENT

Global Engineering

Village

Brand the

engineering

sector

•

Grow engineering

education

capacity

•

Grow

engineering

firms

Potential w

ays to leverage th

e assets:

Opportunities:

Assets: GEOGRAPHIC

LOCATION

Gateway to the

Midwest

Consolidate

logistics base into

Michigan

•

Scale the

Aerotropolis

•

Invest in strategic

trade-related

infrastructure

(e.g., bridge,

tunnel, rail)

HIGHER EDUCATIONSYSTEM

HigherEducation

Marketplace

Strengthen quality,

affordability,

productivity &

economic impact

•

Grow university

enrollment

•

Grow industry &

university

funded R&D

•

Grow commerciali-

zation of R&D

NATURAL RESOURCES

NaturalResourcesEconomy

Grow agricultural

processing and

exports

•

Grow leisure

tourism

•

Lead in alternative

energy

technologies

AUTOMOTIVEINDUSTRY

Global Center ofMobility

Lead in

sustainable mobility•

Lead in multi-

modal systems•

Lead in vehicle/

infrastructure

technology to

improve

road safety•

Grow the auto

industry

HEALTH & MEDICALEXPERTISE

Life Sciences Hub

Create a

Hub for

bio-pharmaceutical

R&D

•

Become the Center

for research,

testing &

medical labs

•

Grow medical

tourism

Distinctive Michigan assets that can grow a New Michigan

Strong base of entrepreneurism, innovation and manufacturing

newmichigan

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Global Engineering Village

The opportunity

In years to come, engineering services are predicted togrow at a rate that far outpaces that of the economy as awhole. The market is especially promising for advancedindustries like aerospace, medical devices and precisioninstruments. In these high-tech manufacturing fields,innovative approaches to improving productivity throughengineering solutions are especially valuable.

Michigan’s competitive advantages

For generations, industrial manufacturing, based onengineered products and manufacturing processes wasthe heart of Michigan’s economy, spawning the need forthousands of engineers to help keep our factoriesrunning. That legacy has left Michigan with moreengineers per capita than any state in the nation acrossa range of disciplines. Michigan engineers have helpedthe American manufacturing sector, and the automotiveindustry in particular, achieve the highest rates ofproductivity in the world. Those engineers will continue tobe needed to improve Michigan-based manufacturing,but the state can realize new growth opportunities bybroadening its engineering base into a service industry.

While pure manufacturing is predicted to yield largelyhistoric growth rates in years to come, engineeringservices, for example, are likely to grow at a rate of 3 to5 percent a year. Michigan is ideally placed to get morethan its share of that growth, and should aspire tobecome one of the top ten states in the country for bothengineering start-ups, the headquarters of establishedengineering firms and mid-sized engineering-anchorednational and international manufacturing companies.

Manufacturing and engineering in advanced industriesand regulated industries presents a strong opportunityfor leveraging Michigan’s inherent capabilities. Oneexample would be to emulate Germany’s machinery andtooling base.

Michigan currently generates less than one 20th ofnational revenues in engineering services; last year weranked 26th among the 50 states on the MilkenInstitute’s Science and Technology Index, whichmeasures states’ technological capacities and ability toturn them into high-tech jobs. We can do far better thanthat if we channel our engineering expertise into newareas that will pay off in more growth.

Michiganhas a strong

tradition ofengineering

expertise

OPPORTUNITY

$ Thousands

Status Quo(current

projectedgrowth)

200

150

100

50

02010

BaselineTop 5

US Growth(2.8%)

2020 Projection Scenarios

Top 1US Growth

(7.9%)

Top 5Growth(9.5%)

Top 1Growth(20.2%)

88 71

116

188

6

4

2

0

.9 1.1 2.1

5.3

Michigan GDP growth per capita

Potential Impact of Global Engineering Village

ThousandsMichigan job growth

$1.0 - $4.2additional impact

45K - 117Kadditional impact

A NEW M

ICHIGAN: ONE VISION, SIX OPPORTUNITIES

How to build on those advantages

One industry especially conducive to such growth —and especially suited to Michigan’s strengths —is the military and defense industry, and especially itsaerospace component. The aircraft supplier market isestimated to grow at an average annual rate of between3.5 and 5 percent in coming years. Because this industry iscrucial to national defense, companies in it are generallybetter protected from the whims of the marketplace,through regulation and high barriers of entry. Volatility islow and operating margins generally high.

Michigan has much to bring to these advanced andregulated industries. It was here that manufacturingprocess design made its greatest strides not just in the20th century, but in the last decade as well. Anestimated 45 percent of all productivity gains in theautomotive industry over the last 15 years have comefrom process improvements. Introducing real timeperformance management, speeding up assembly lines,and improving production planning have made a massivedifference to the automotive industry, and those bestpractices are directly applicable to higher-marginindustries like aerospace and machinery.

If we build on our automotive legacy to embrace cutting-edge approaches in nanotechnology, mechatronics andelectro-mechanics, we can turn Michigan into a globalvillage of engineering excellence and offer end-to-endengineering solutions, including R&D in numerous areassuch as advanced machinery and tools and end-to-endprecision manufacturing applications for medical devicesand instruments.

Beyond increasing global recognition of Michigan’sengineering capabilities through a distinctive brandingeffort, Michigan can also expand efforts to helpengineers start-up new engineering firms and to attractmore engineering firms to consolidate operations intoMichigan. In addition, by expanding engineeringeducation programs at both universities and communitycolleges, Michigan can increase the flow of engineeringtalent and help ensure a long-term talent pipeline.

Michigan ranks number 1 in the nation in engineers per capita

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Gateway to the Midwest

The opportunity

The emergence of the global marketplace has spurredan exponential growth in the movement of goods andpeople. According to the World Trade Organization,international trade increased at an average annual rateof 6.2 percent from 1950 to 2007, far faster thaneconomic output in general. Trade and travel rates areslowly returning to those attained before the 2008-2009recession. Longer-term forecasts suggest an upwardtrend fed by the growth of just-in-time supply chainmanagement, manufacturer-to-consumer delivery andglobal engagement of employee teams.


Half the population of the U.S. and Canada lives within500 miles of Michigan. While Chicago has beenAmerica’s traditional gateway to the vast market of theMidwest, its hub airport is land-locked, its highways arecongested and its water port is too remote toaccommodate much additional growth.

Whether accessed via road, rail, sea or air, Michigan haspowerful inherent advantages that make it an idealepicenter for trade between the Midwest and the rest ofthe world. Already, 374,000 logistics jobs are located inthe state. Michigan has exemplary access to theInterstate highway system and its Canadian counterpart,and excellent rail links serviced by four of the nation’s sixmain railroads. The Port of Detroit has water depthscapable of handling the deepest vessels which canoperate on the Great Lakes, and can add to theMidwest’s freight route to Europe, the Middle East,South America and Africa. Our two Detroit area airports,Detroit Metro and Willow Run, give us the fifth largestrunway capacity in the U.S., and this capacity is currentlyunderutilized.

Surrounded by undevelopedland, DTW has the potential to bethe single largest hub in air travel

Michigan has the

highest valueland portal

OPPORTUNITY

Status Quo(current

projectedgrowth)

300

200

100

02010

BaselineTop 5

US Growth(5.3%)


Top 1US Growth

(7.9%)

Top 3Growth(9.3%)

Top 1Growth(12.2%)

94 137157

201

3

2

1

00.9 1.5

2.1

2.7

$.6K - $1.2Kadditional impact


$ ThousandsMichigan GDP growth per capita

Potential Impact of Gateway to the Midwest


A NEW M



Together these conditions present an enormousopportunity to transform Michigan into an integrated,multi-vector freight hub. Just the Aerotropolis alone, theaviation portion of this effort, is estimated to generate60,000 new jobs and provide an impetus for more than$10 billion in additional economic activity for the state.But getting there requires a broad commitment tobuilding out and integrating an infrastructure networkthat can support a global logistics hub.

For example, it is completely feasible, throughcoordinated development around Metro and Willow Runairports, to create a Detroit Aerotropolis that would serveas a powerful magnet for aviation-intensive businessesof all sorts. Unlike most other cities, Detroit is in aposition to facilitate airport growth; there are anestimated 10,000 to 25,000 acres of developable landaround Willow Run and Metro Airports that is alreadyfast-tracked for development through creation of aspecial development zone. Detroit has more unusedcapacity and a stronger service record than competitorsin the region, notably Chicago. The Aerotropolis hasalready attracted significant investment with minimalmarketing and infrastructure development.

By exploiting similar advantages of its deep-water port,international border crossing and rail freight system,Michigan can achieve the growth opportunity afforded bythe logistics industry. For example, the Port of Detroitcan become the key Great Lakes Freight Gateway.Vacant land adjacent to the current port facilities couldbecome the site of more inland port infrastructures. ThePort of Detroit is already equipped to handle the world’sbiggest container ships, and currently receives the fifthhighest value of international trade of any U.S. port.Similar opportunities abound if a new international tradecrossing is built and a multi-modal rail freight center isdeveloped.

Building such a logistics infrastructure requires a broadcommitment, but it would pay off in making Michigan akey node in the consolidation of a still fragmentedindustry. To make it happen, a dedicated developmententity is needed that could put a unifying brand on theeffort to strengthen Michigan's logistics potential, andcoordinate among state and local administrations andpermitting authorities. The private sector, in turn, needsto actively embrace the use of Michigan as a center forshipping and logistics, and help secure the financingnecessary to build it out. Creative financing models,which may draw on both public and private resources,will also be crucial to securing Michigan’s place as theGateway to the Midwest.

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Higher Education Marketplace

The opportunity

More and more, economic growth in developed nationsstems not from growth in the labor force, but fromgrowth in productivity. That puts the need for innovationat the forefront of any plan to maximize growth, and theprimary source of increasing that pool of innovation ishigher education.


Michigan has some of the finest research andbaccalaureate universities in the country, and graduatesa higher percentage of its students than the nationalaverage in the science, technology, engineering andmath (STEM) disciplines. But we can’t afford to rest onour laurels. Michigan will need an additional 1.3 millioncollege graduates by the year 2025 based on currentworkforce trends. Many more states are increasing theirinvestments in higher education to meet their futuretalent needs, and doing a better job than Michigan doesat translating that commitment into innovation that hascommercial impact and fosters growth.

In 2009, Michigan ranked tenth in the nation inacademic R&D spending, and ranked sixth in the nationin the amount of federal research funding we attract.But our state’s higher education expenditures are fallingbehind those of other states hindering our universities’ability to grow and attract additional federal and privateR&D research funding.


Michigan should set a concrete goal of being among thetop ten states for higher education, measured in quality,affordability, productivity and economic impact. Anincentivized, performance-based funding approach forstate support would encourage universities to strive to bebest in class without undermining the strength of these

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Michigan is 4th in thenation for

producingpatents

OPPORTUNITY

Status Quo(current

projectedgrowth)

150

100

50

02010

BaselineTop 5

US Growth(4.3%)


Top 1US Growth

(13.0%)

Top 5Growth(1.6%)

Top 1Growth(9.2%)

39 50 59

132

4

2

0

1.4 1.5 1.6 3.4

$0.2K - $1.9Kadditional impact



Potential Impact of Higher Education Marketplace


A NEW M


institutions. Such a funding approach would also helpconvince an increasingly skeptical public that investingin higher education translates into good jobs andinnovation, and thus to a better economy for Michigan.

Michigan also could realize a significant economicopportunity by encouraging universities to increase theirenrollment of out-of-state students, without reducingaccess for in-state students. Michigan universities are indemand, but they under-enroll out-of-state studentscompared to comparable peer institutions elsewhere. WithMichigan’s indigenous youth population getting smaller,this portends a serious talent shortfall in the future.Increasing the enrollment of out-of-state students couldadd over 20,000 additional students to the state’s pipelineof future talent, bringing in more than $200 million peryear in increased direct revenue. While Michiganuniversities rank sixth in the nation in attracting federalR&D expenditures per capita, given the importance of R&Dto the growth of productivity, we must do better. This willrequire a concerted effort to attract both more federal andindustry-sponsored R&D to Michigan. Federal moniessupport 57 percent of all basic research conducted in theU.S., and the bulk of it flows to universities. These funds,properly allotted, can seed innovation and fostersubstantial economic development. As well as Michigandoes in this regard, the national leader, Massachusetts,attracts more than twice what we do per student, helpingthat state to foster 79 percent more startups thanMichigan did per R&D dollar. For example, Michigan’sUniversity Research Corridor (comprised of Michigan StateUniversity, University of Michigan and Wayne StateUniversity) ranks next to last in attracting industry R&Drelative to six other U.S. research clusters.

While Michigan is among the nation's leaders in patentactivity and innovation output, we can better leveragethose achievements by strengthening university-business-entrepreneurial partnerships. Great progresshas been made in this area over the past decade inMichigan through new university business engagementcenters, business accelerators and entrepreneurialprograms. But we are still in the early stages ofdeveloping these partnerships to acceleratecommercialization and business growth.

Finally, while the vast majority of the jobs of the futurewill require education beyond high school, not all willnecessarily require a bachelor’s degree. These needscan be met by expanding technical education programsat community colleges and through better awareness ofthe skills tomorrow’s workforce will require.

Michigan ranks 9th in the nation in

Science & Engineering graduates

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Natural Resources Economy

The opportunity

Globalization, increasing world population and risingincome levels in developing nations are all increasing thedemand for natural resources – chiefly food, energysources, precious materials, and water. This creates amassive opportunity not only for those providing thosecommodities, but also for those in a position to developtechnologies and approaches that maximize theproductivity of ever-scarcer resources.


Michigan’s varied agricultural industry has flourished inpart because of the local engineering capabilities thathave been brought to bear on improving it. That dynamicbetween farmer and innovator offers Michigan a markedadvantage in the field of precision agriculture, whereautomation control and satellite imagery are applied tobring new levels of efficiency to planting, fertilizing andharvesting crops. The industry is booming at a projectedrate of more than 19 percent per year, and for goodreason: farm productivity matters more than ever aspopulations swell, land suitable for cultivation becomesmore scarce and a complex world commoditymarketplace increases price volatility. Michigan has allthe pieces in place to lead this trend. With globaldemand for food expected to rise by 70 percent between2000 and 2050 and Michigan farms producing 50percent more feed-grains than state residents consume,Michigan can become a key provider of the world’s foodsupply by increasing exports and growing its foodprocessing capacity.

Michigan can also leverage its natural beauty in thelucrative tourism market, which brought the state anestimated $17.2 billion in revenue in 2010. Tourismoutlays are highly sensitive to the overall economy, andhave dropped off in general since the recession, butMichigan’s tourism industry has been hurtproportionately less than that of other U.S. states.The industry provides jobs for some 156,200 Michiganresidents as it is, and the growing trend towards nichemarkets plays to the state’s strengths.

Finally, Michigan has the greatest supply of freshwater inthe world, large wind corridors and an expertise inalternative energy technologies that give it an opportunityto help meet the world’s need for new manufacturingand energy sources.

Michigan is theleading state

for agriculturaldiversity, expert

in foodproduction

OPPORTUNITY

Status Quo(current

projectedgrowth)

300

200

100

02010

BaselineTop 5

US Growth(0.73%)


Top 1US Growth

(2.4%)

Top 5Growth(2.8%)

Top 1Growth(5.5%)

217177

233276

3

2

1

0

1.71.3

2.22.9




Potential Impact of Natural Resources Economy


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Agricultural processing and exports can be increased bysupporting policies and regulations designed to grow theindustry, increasing agricultural engineering solutions,expanding the export transportation infrastructure andhelping expand overseas markets.

As for tourism, Michigan’s easy access to majorpopulation centers, its relatively low costs, and theintrinsic and varied attractiveness of its natural amenitiesposition the state’s industry well for future growth. Butthose assets need to be appropriately marketed andsupported by strategic development of travel andhospitality infrastructures.

In the longer run, Michigan’s plentiful supply of freshwater could be an economic asset, as diminishingsupplies begin to have an impact on companies’decisions about where to locate their facilities. Michigancan work now to attract water-intensive industries to thestate that adopt safe, sustainable practices to preventthe diversion of water outside of Michigan. It’s criticalthat Michigan remain mindful that protecting our waterstocks and keeping them secure will leave the state withan incalculable advantage for decades to come. Inaddition we can leverage our engineering andmanufacturing assets to define future products andservices for the water management value chain to meetthe needs of water scarce regions in the world.

Concurrently, our specialized expertise in alternativeenergy technologies should continue to be expandedthrough the education of new talent, researchinvestments and engineering solutions that applyautomotive learnings across disciplines. Prudentutilization of natural shale, wind and precious mineralsshould also be pursued.

Michigan issurrounded by 95%of the total US freshwater supply

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Global Center of Mobility

The opportunity

The global automotive industry is projected to expand by31 percent by 2020 as the world’s growing middle classacquires personal transportation. In addition, theindustry is rapidly transforming to enable the automobileto serve as an extension of an individual’s office or homewhile becoming more energy efficient. By 2020, almost aquarter of units produced are expected to be hybridvehicles, and by 2050, the internal combustion engineand the hybrid alike are expected to be eclipsed byelectric cars powered exclusively by fuel cells andbatteries.


For more than a century, Michigan has been the centerof the American automotive industry, and for almost aslong the center of the global industry. Michigan is thenumber one state for vehicle research and development,the number one state for vehicle production and home to47 of the top 50 automotive suppliers. It is now uniquelyequipped to broaden its unmatched network of suppliers,talent, and R&D capabilities and become the globalcenter of mobility.


Michigan should aspire to lead the trend towardsustainable mobility, and it is well-placed to do so.Whenever disruptive technologies create or transform anindustry, established actors serve as nuclei for clusters ofrelated economic activity. Consider how Silicon Valleygrew up around Hewlett Packard and other earlycomputer technology companies. Or how Norway’s oilfield and supply equipment sector, now a world leader,developed around existing exploration companies, largelybecause the oil shock forced companies to find newrevenue streams and the government was foresightedenough to provide the business climate, researchsupport, and vision needed to seed change.

Michigan is thenumber 1 state for vehicle researchand development

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US Growth(3.5%)


Top 1US Growth

(4.9%)

Top 5Growth(11.5%)

Top 1Growth(16.7%)

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185

211

15

10

5

0

2.3 2.3 6.7

10.6


100K- 126Kadditional impact


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The conditions exist for Michigan to make a similartransformation. We should aspire to make our existingautomotive cluster the hub of many more, relatedclusters in areas we know will emerge given thedemands of the global mobility market. For instance,Michigan should be home to the greatest concentrationanywhere of R&D and manufacturing of the mosttechnologically challenging parts of electric vehicles. It ishere, in our labs and factories, that we should strive todevelop the next-generation of electric powertrains,battery cells and cathode materials, which must meetconsumer needs in terms of value and affordability; it ishere that we can design, test and manufacture electricmotors, and work to improve the efficiency ofconventional power trains as well. And whatevertechnologies emerge to power the cars of the future,there is bound to be a premium on lighter-weightmaterials that can be recycled. Michigan should push toassure that the materials cluster that explores andexploits those possibilities puts roots down here. To enterthis next stage of advanced products in the globalmobility arena, we need to cross-fertilize the expertise ofmultiple industry value chains, within and outside theautomotive realm. Michigan can be the hub of the futuremobility center.

Similarly, this should be the place where thecutting-edge research occurs on connected vehicletechnologies, such as GPS-assisted parking. With propersupport and planning, there is no reason why Michiganshouldn’t be the location where game-changing,driverless automated vehicles become a commercialreality. These are products that make their own market;consumers don’t even realize they want them, much asthey didn't know they wanted Model Ts until Henry Forddesigned them, or iPods or iPads until Steve Jobspushed them into an unsuspecting world.

Finally, our automotive expertise can also be leveragedinto developing multi-modal systems of transportation foran increasingly urbanized world. For example, solutionsthat allow personal forms of transportation to integrateseamlessly with public transit systems would minimizecongestion and reduce emissions. These opportunitiescan help to draw out-of-state talent and create anongoing circle of technological development in thisindustry.

47 of the top 50 automotive suppliers

are located in Michigan

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Life Sciences Hub

The opportunity

The aging of the population in developed nations, agrowing middle class in the developing world and thedemand for a higher quality of life among all populationsis driving demand for life sciences solutions. Healthcareexpenditure in the developed world is already outpacingGDP, and the gap is widening. Few industries can comeclose to matching the long-term growth potential of bio-science industries.


Michigan is well placed to capitalize on this demand.We turn out the eighth highest number of universitybio-science degrees and rank 15th in employment inthis arena. For example, we confer 5,500 degrees in thebio-science field every year and registered more than1800 bio-science patents in the five years from 2004 to2009, giving us a tenth-place ranking in the nation.

We have a unique combination of excellent high-endmedical research facilities and an overcapacity ofhospital acute care facilities. And there is an existingindustry to build on, as well. The bio-pharma industryemployed more than 20,000 people directly in the statein 2008, and another 75,000 in related industries. Itcontributed $8 billion directly to our state output, andseeded a further $12 billion in revenue in relatedindustries.


One place to start is with bio-pharma products. This areahas a strong cluster effect and a great potential forfurther growth, and we could jumpstart it by cultivatingan incubation hub for bio-pharma. Accelerating effortswould help foster more startups and encourage theminto profitability, and create the broader connectionsacross the entrepreneurial community to help thisindustry grow in Michigan.

In the bio-science arena as in engineering, services aregrowing at a much faster rate than products, a trend we

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The life sciencesmultiplier effect:one job creates fourspin-off jobs

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2010Baseline

Top 5US Growth

(2.8%)


Top 1US Growth

(5.5%)

Top 5Growth(7.5%)

Top 1Growth(15.4%)

45 5160

77

3

2

1

0 0.60.9 1.1

2.3$0.2K - $1.4K

additional impact



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should be mindful of as we promote this asset. Thebiopharmaceutical service industry provides more jobsacross the nation than the manufacturing of drugs does,and national employment there rose by more than 50percent from 2004 to 2008. We should concentrate ourefforts on becoming a center of excellence for suchservices. Specifically, that means developing research,testing and medical lab services to serve the broader lifescience industry. We have a great starting point: Inrecent years we conferred 17 percent more bachelor’sdegrees in bio-science and engineering per capita thanthe national average. And we rank 13th in the country inrunning clinical trials for drugs and medical devices, aservice that plays to our strengths.

Finally, we should pursue all available means to makeMichigan a destination of excellence for medical care ofout-of-state and foreign patients, both in the high-endand lower-price markets. Healthcare expenditure in thedeveloped world is already outpacing GDP, and the gap iswidening. In the U.S., the wellness industry has grown atan average annual pace of more than 22 percent in thelast decade. A focused commitment could put us in anexcellent position to reap far more than our natural shareof that growth.

Our state’s more than 150 hospitals, 50 of them withlarge acute care facilities, are less than 70 percentoccupied and many are nationally recognized centers ofexcellence. These are all good circumstances forMichigan to get to the front of the line in attracting

patients from elsewhere, particularly in light of ourcentral geographical location and transportinfrastructure. Michigan hospitals can competesuccessfully for long-term health maintenance and evensurgical contracts from out-of-state employers andinsurers interested in managing rising healthcare costswhile providing excellent care to employees.

What’s needed to fulfill our potential is a clear road mapthat demonstrates a long-term commitment to thegrowth of the life sciences industry. That should includelong-horizon investments, a rational regulatory and legalenvironment, strong support for the universities and theirefforts to pursue cutting-edge research and attract top-quality students and faculty, and entrepreneurial supportfor start-ups and scaling of successful small andmedium-sized companies.

Michigan turns outthe 8th highestnumber of universitybio-science degrees

We are convinced that Michigan can move to a farbrighter future if it embraces these six growthopportunities. Each one of them builds on specific,existing strengths that offer a high probability, ourresearch suggests, of improving our state’s overalloutput, our productivity, and our jobs picture.

That’s not to say, however, that they represent the finalword. We welcome suggestions from all quarterstoward shaping and refining these initiatives, andtoward identifying other ways to leverage our assetstoday into greater opportunities tomorrow.

We hope this document sparks a broad and fertilediscussion about additional initiatives for growth, andeventually a concrete plan on achieving them. But theplan, of course, is only the beginning. Implementing itwill require the commitment of all stakeholders —private enterprise, the public sector, and supportingassociations and entities responsible for guidingeconomic development.

Forging a shared vision is vital. The regions of the worldthat have been most successful at achieving strong,sustained economic growth tend to be those that couldforge a common approach on how to do it. Only withclarity and shared purpose can any region sustain thework needed to realize a vision of economic growth

over decades. The southern states after World War IIpresent one example of how this can be donesuccessfully. While some succeeded better than others,most realized they needed to embrace economictransformation, prioritize their investments in a fewareas that would accelerate economic growth, andbuild broad alliances across all segments of thecommunity to sustain the effort. Germany in the sameperiod offers another example. From a starting point ofabsolute devastation, the country recast itself, buildingon its strong tradition of technical innovation to strikeout on a new path of phenomenal growth, encouragedby access to free markets and a stable financialenvironment.

For too long, Michigan has lacked that sense of acommon purpose. It has been a state divided by region,political party, class, race and labor status. Onlyrecently have these divisions begun to fade as thestresses associated with a weak economy delivered apainful reminder of an often forgotten truth: thatMichigan will rise or fall based on the success of ourcollective efforts. Success spawns more success. Andwith a common sense of direction, we can retain themomentum needed for longterm prosperity.

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In Conclusion

New Michigan Champion William Clay Ford, Jr., Executive Chairman,

Ford Motor Company

Global Engineering Village co-championsJames P. Hackett, President & CEO, Steelcase Inc.Charles G. McClure, Chairman, President & CEO,Meritor, Inc.

Gateway to the Midwest co-championsStephen E. Gorman, Executive VP & COO, Delta Air Lines

Douglas W. Stotlar, President & CEO, Con-way Inc.

Higher Education Marketplace co-championsJ. Patrick Doyle, President & CEO, Domino’s PizzaMary Sue Coleman, President, University of Michigan

Natural Resources Economy co-championsStephen M. Kircher, President & CEO, Boyne Eastern Operations - Boyne Resorts

Lou Anna K. Simon, President, Michigan State University

Global Center of Mobility co-championsWilliam Clay Ford, Jr., Executive Chairman, Ford Motor Company

Stephen K. Carlisle, GM Vice President, Global Product Planning, General Motors Company

Life Sciences Hub co-championsWilliam U. Parfet, Chairman & CEO, MPI ResearchMichael J. Jandernoa, Board of Directors, Perrigo Company

Business Leaders for Michigan is committed toengaging major stakeholder groups to work together toadvance the six opportunities we have outlined in thisdocument. We will do all we can to champion theseopportunities. When needed, we hope to serve as acatalyst to encourage other organizations to collaborateon furthering these efforts across the state. BLM willconvene regular meetings of key stakeholders to pushahead and share best practices. We are committed, too,to keeping the public abreast of the progress our stateis making.

We hope this plan spurs interest and engagementacross our state, from elected leaders, business

groups, civic organizations and citizens. Our centralmessage is that Michigan has enormous economicassets, and that with genuine commitment, hard workand a dedication to positive change, we can shiftMichigan back to a pathway of sustainable growth. Letthe discussion begin in earnest about what a NewMichigan can be and how to get there. We’ve laid outour vision of the goal. Now we need your input, yourengagement, and your passion to make it a reality.

For more information about Business Leaders for Michigan, the 2012 Michigan Turnaround Plan and the path to a New Michigan, visit:www.BusinessLeadersforMichigan.com

CONCLUSION

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JAMES B. NICHOLSONCHAIR OF THE BOARDPVS Chemicals Inc.

TERENCE E. ADDERLEYKelly Services, Inc.

DANIEL F. AKERSONGeneral Motors Company

MARK ALYEAAlro Steel Corporation

GERARD M. ANDERSON DTE Energy Company

JON E. BARFIELD The Bartech Group, Inc.

ALBERT M. BERRIZ McKinley, Inc.

MARK J. BISSELLBISSELL Inc.

STEPHEN J, BOSHOVENFarmers Insurance Group

STEPHEN K. CARLISLEGeneral Motors Company

MARY SUE COLEMAN University of Michigan

TIMOTHY P. COLLINSComcast Cable

ROBERT S. CUBBINMeadowbrook Insurance Group, Inc.

KURT L. DARROWLa-Z-Boy Incorporated

DAVID C. DAUCH American Axle & Manufacturing

RICHARD L. DeVOREPNC Financial Services Group

DOUGLAS L. DeVOSAmway

J. PATRICK DOYLEDomino’s Pizza

JAMES E. DUNLAPHuntington

FREDERICK H. EPPINGERThe Hanover Insurance Group

JEFF M. FETTIGWhirlpool Corporation

WILLIAM CLAY FORD, JR. Ford Motor Company

YOUSIF B. GHAFARIGHAFARI, Inc.

DANIEL GILBERTQuicken Loans Inc.

ALLAN D. GILMOURWayne State University

ALFRED R. GLANCY III Unico Investment Group LLC

DAN GORDONGordon Food Service, Inc.

STEPHEN E. GORMANDelta Air Lines, Inc.

JAMES P. HACKETTSteelcase Inc.

RONALD E. HALL Bridgewater Interiors, LLC

RICHARD G. HAWORTHHaworth, Inc.

CHRISTOPHER ILITCH Ilitch Holdings, Inc.

MICHAEL J. JANDERNOAPerrigo Company

MILES E. JONESDawn Food Products, Inc.

DAVID W. JOOSCMS Energy Corporation

HANS-WERNER KAAS McKinsey & Company

ALAN JAY KAUFMANKaufman Financial Group

JOHN C. KENNEDYAutocam

STEPHEN M. KIRCHERBoyne Resorts

BLAKE W. KRUEGERWolverine World Wide, Inc.

ANDREW N. LIVERISDow Chemical Company

DANIEL J. LOEPP Blue Cross Blue Shield of Michigan

STEPHEN P. MacMILLANStryker Corporation

BEN C. MAIBACH III Barton Malow Company

TIMOTHY M. MANGANELLOBorgWarner Inc.

RICHARD A. MANOOGIAN Masco Corporation

FLORINE MARK The WW Group, Inc.

SARAH L. McCLELLAND Chase

CHARLES G. McCLURE Meritor, Inc.

DAVID E. MEADORDTE Energy

HANK MEIJERMeijer, Inc.

MICHAEL MILLERGoogle, Inc.

MARK A. MURRAYMeijer, Inc.

CATHLEEN H. NASHCitizens Republic Bancorp

THOMAS D. OGDEN Comerica Bank

JAMES O’LEARY Kaydon Corporation

WILLIAM U. PARFETMPI Research

Business Leaders for Michigan - 2012 Board of Directors

BUSINESS LEADERS FOR MICHIGAN 2012 BOARD OF DIRECTORS

CYNTHIA J. PASKY Strategic Staffing Solutions

ROGER S. PENSKE Penske Corporation

WILLIAM F. PICKARD GlobalAutomotiveAlliance

SANDRA E. PIERCE Charter One - Michigan

GERRY PODESTABASF

CHARLES H. PODOWSKI The Auto Club Group

STEPHEN R. POLK R. L. Polk & Co.

JOHN RAKOLTA, JR. Walbridge

DOUG ROTHWELL Business Leaders for Michigan

ANDRA M. RUSHDakkota Integrated Systems, LLC

JOHN G. RUSSELLCMS Energy Corporation/Consumers Energy Co.

RICHARD F. RUSSELL Amerisure Companies

ALAN F. SCHULTZValassis

ALAN E. SCHWARTZ HONIGMAN

J. DONALD SHEETSDow Corning

BRAD SIMMONSFord Motor Company

LOU ANNA K. SIMON, Ph.D. Michigan State University

SAM SIMONAtlas Oil Company

MATTHEW J. SIMONCINILear Corporation

BRIG SORBERTwo Men and a Truck International

DONALD J. STEBBINS Visteon Corporation

DOUGLAS W. STOTLARCon-Way Inc.

ROBERT S. TAUBMAN Taubman, Inc.

SAMUEL VALENTI III TriMas Corporation

STEPHEN A. VAN ANDELAmway

MICHELLE L. VAN DYKEFifth Third Bank

TIMOTHY WADHAMS Masco Corporation

BRIAN C. WALKERHerman Miller, Inc.

WILLIAM H. WEIDEMAN The Dow Chemical Company

WILLIAM C. YOUNG Plastipak Holdings, Inc.

Bank of America

Energy Conversion Devices, Inc.

We commit to serving as a catalyst,advocate and champion to transformMichigan’s economy.

Michigan is our home: We live, work and raiseour families here.

We believe a vibrant Michigan economy willmake our state a place where business wantsto invest and people want to live and work.

A Commitment and a Promise: From Business Leaders for Michigan

We promise to sustain our effort for thelong-term and take an active role in leadingthis transformation.

We will work beyond political terms to sustainthe effort.

We will focus on achieving the plan’s goals andwelcome different ideas for achieving them.

The Michigan Turnaround Plan (2012)

Economy & Finance

Transcript of The Michigan Turnaround Plan (2012)