Michigan workers more likely to work for big business -- then and now

Michigan has a long-held reputation as a big-business state.

But the number of large establishments in the state and the number of workers they employ have dropped significantly since the mid-1990s, according to statistics compiled by the U.S. Small Business Administration and the Edward Lowe Foundation in Cassopolis.

The Lowe Foundation compiles statistics on small businesses through its YourEconomy.org website, which uses business reporting data from Dun & Bradstreet.

Companies with at least 500 workers employed 23.9 percent of all private-sector workers in Michigan in 1995, a higher percentage than in the surrounding states of Illinois, Indiana, Ohio and Wisconsin.

However, the share of employment by big business fell in Michigan to 15.8 percent in 2009 -- the biggest drop in the aforementioned Great Lakes states, according to YourEconomy.org.

Despite the drop, Michigan still has a higher percentage of workers in large companies than surrounding states. Illinois ranked second with 15.3 percent of employees in big companies; Wisconsin was third at 14.6 percent; Ohio fourth at 14.2 percent and Indiana fifth at 11.7 percent.

Nationally, large companies employed about 12 percent of all workers.

One of the reasons for Michigan’s comparatively high employment in big companies is the large number of long-established, home-grown businesses, said Mark Lange, executive director of the Lowe Foundation.

“That speaks to Michigan’s entrepreneurial history,” he said.

Of all the companies operating in Michigan in 2009, 90.5 percent were headquartered here. That was a higher percentage than in any neighboring state except Wisconsin, where 90.8 percent of all companies were locally owned.

Still, Michigan lost more than a third of its large companies with headquarters in the state between 2000 and 2009 as the auto industry and office furniture industries went into a tailspin.

The number of so-called “resident” large companies fell from 670 in 2000 to 424 in 2009. Those companies shed 44 percent of their jobs during that time period, from nearly 1.1 million in 2000 to 467,560 in 2009.

Overall, Michigan lost 104 large companies over the past decade, including those with headquarters outside the state, according to the Small Business Administration.

But tens of thousands of small businesses in Michigan and surrounding states also closed during the past decade. With the exception of Illinois, the region had fewer small businesses in 2009 than it did in 2000. Illinois’ small business population state was flat at about 249,600 businesses.

The total number of small businesses with employees in the United States rose from about 5.6 million in 2000 to about 5.7 million in 2009.

Comparison data is available only through 2009, which was the bottom of the worst recession since the Great Depression of the 1930s.

Rick Haglund has had a distinguished career covering Michigan business, economics and government at newspapers throughout the state. Most recently, at Booth Newspapers he wrote a statewide business column and was one of only three such columnists in Michigan. He also covered the auto industry and Michigan’s economy extensively.

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