Michingan Economy Losing Defense Dollars As Well

by: Matthew Potter
June 22, 2009

Category: Business Line, Congress, Contract Awards, Department of Defense, Events, logistics, Michigan, production program, Restructuring, Services, States | RSS 2.0

Michigan is seeing its car based economy erode quickly with the bankruptcies of Chrysler and General Motors and now word is that the defense dollars flowing to the state are down as well. Crain’s Detroit Business is reporting that defense contracts fell by almost a third compared to the same period last year. One of the problems faced seems to be that the U.S. Defense Department is putting work out to bid but then not awarding the contracts. This may be due to a reassessment of needs by the new Administration, or just changing the timing of the work.

Michigan has one of the highest unemployment rates in the country with no real changes on the horizon that will turn that around. Defense dollars were offsetting some of the losses in civil industry and the state has aggressively gone after them. It is expected that in the next few years to be some major cuts to defense spending and this may exacerbate the problems the state is experiencing.

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