HUD PD&R Housing Market Profiles Detroit-Warren-Dearborn, Michigan Quick Facts About Detroit-Warren- Dearborn Detroit, Michigan By Gabriel A. Labovitz | As of April 1, 2020 Current sales market conditions: balanced Overview Current rental market conditions: balanced The Detroit-Warren-Dearborn, MI Metropolitan Statistical Area (hereafter, the Detroit metropolitan area) includes Lenawee, In 1950, the city of Detroit was the fifth-largest Livingston, Macomb, Oakland, St. Clair, and Wayne Counties in city in the United States as measured by southeastern Michigan. Despite the significant loss of population population, then at 1.85 million. By 2010, the since 1950, the city of Detroit and the Detroit metropolitan population of the city of Detroit fell to 713,800, area remain the largest city and metropolitan area in the state becoming the 19th-largest city by population. of Michigan. The city of Detroit is a major medical center for Detroit is the only city in the United States to southern Michigan and northern Ohio, which includes several have a population peak above 1 million and hospital systems, and the education and health services sector is subsequently fall below that level. the second-largest employment sector in the metropolitan area after the professional and business services sector. The Detroit metropolitan area is also a major entertainment destination for the surrounding area. After the opening of the Little Caesars Arena (LCA) in 2017, with a development cost of more than $860 million, four professional major league sports teams play in the city of Detroit. The Detroit Pistons of the National Basketball Association play at the LCA, formerly playing in suburban Auburn Hills. The Detroit Red Wings of the National Hockey League also play at the LCA, and the Detroit Tigers (Major League Baseball) and the Detroit Lions (National Football League) play at Comerica Park and Ford Field, respectively, located less than one-half mile from the LCA. This entertainment area, named The District Detroit, is continued on page 2 U.S. Department of Housing and Urban Development | Office of Policy Development and Research 2 HUD PD&R Housing Market Profiles Detroit-Warren-Dearborn, Michigan As of April 1, 2020 continued from page 1 located north of the Central Business District and has attracted from 2010 through 2017, compared with the national rate of job residential and commercial development with an economic impact growth, which averaged 1.7 percent annually. By contrast, since estimated at $2.1 billion for the Detroit metropolitan area (The 2017, nonfarm payrolls fell slightly in the Detroit metropolitan District Detroit). area, declining an average of 0.1 percent annually, while national payrolls rose 0.6 percent annually on average. y As of April 1, 2020, the population of the Detroit metropolitan area is essentially stable and estimated at 4.33 million, y The largest county in the Detroit metropolitan area by representing an annual average decline of 1,700 people since population is Wayne County, which includes the city of Detroit 2017 (U.S. Census Bureau population estimates as of July 1). and accounts for approximately 40 percent of the total By contrast, from 2010 to 2017, the population rose by an population in the metropolitan area. Three counties in the six- average of 4,150, or 0.1 percent, annually. county area had increased population from 2010 to 2019, led by Livingston County, which grew 0.7 percent annually, followed y The population grew through 2017 due to job expansion in the by Oakland and Macomb Counties, which expanded 0.5 and Detroit metropolitan area, which averaged 2.0 percent annually 0.4 percent annually, respectively. Economy Economic conditions in the Detroit metropolitan area are currently 2010, because jobs in this sector rose an average of 4.1 percent, weak, reflecting slower job growth since 2017. Despite strong job or 2,600 jobs, annually from 2010 through 2017, and accelerated growth in the area from 2010 to 2017, current nonfarm payroll jobs to growth averaging 8.0 percent, or 6,300 jobs, annually from 2017 remain below the pre-recession peak of 2.23 million jobs averaged to the current date. during 2000. During the first quarter of 2020, nonfarm payrolls During the first quarter of 2020— rose 0.4 percent from a year earlier and averaged 2.02 million jobs, following faster growth of 0.8 percent during the first quarter y The strongest rate of growth in the Detroit metropolitan area of 2019. Five job sectors increased during the past year, and six was in the transportation and utilities sector, which added 7,400 sectors declined. Economic growth in the Detroit metropolitan area jobs, or growth of 9.1 percent. Among recent job expansions has been supported by the transportation and utilities sector since in this sector, Penske Logistics—part of Penske Truck Leasing continued on page 3 Strong growth in the transportation and utilities and the education and health services sectors offset declines in six other sectors during the first quarter of 2020, leading to nonfarm payroll growth in the Detroit metropolitan area. 3 Months Ending Year-Over-Year Change March 2019 March 2020 Absolute Percent (Thousands) (Thousands) (Thousands) Total Nonfarm Payrolls 2,015.4 2,023.7 8.3 0.4 Goods-Producing Sectors 326.9 327.9 1.0 0.3 Mining, Logging, & Construction 68.1 71.6 3.5 5.1 Manufacturing 258.8 256.3 -2.5 -1.0 Service-Providing Sectors 1,688.5 1,695.8 7.3 0.4 Wholesale & Retail Trade 294.0 291.4 -2.6 -0.9 Transportation & Utilities 81.6 89.0 7.4 9.1 Information 26.9 26.1 -0.8 -3.0 Financial Activities 118.6 120.6 2.0 1.7 Professional & Business Services 391.8 390.1 -1.7 -0.4 Education & Health Services 316.2 322.1 5.9 1.9 Leisure & Hospitality 195.1 191.1 -4.0 -2.1 Other Services 74.6 73.6 -1.0 -1.3 Government 189.7 191.8 2.1 1.1 Unemployment Rate 4.7% 4.3% Note: Numbers may not add to totals due to rounding. Source: U.S. Bureau of Labor Statistics U.S. Department of Housing and Urban Development | Office of Policy Development and Research 3 HUD PD&R Housing Market Profiles Detroit-Warren-Dearborn, Michigan As of April 1, 2020 continued from page 2 Co., L.P.—opened a fresh distribution center in Romulus, Chrysler Automobiles N.V. to invest $1.6 billion in a new plant on Wayne County, in June 2019 to serve the distribution needs of Mack Avenue, located in the East Side area of the city of Detroit, is The Kroger Co., adding 400 jobs. expected to result in up to 4,500 new jobs beginning in late 2020. Ford Motor Company and General Motors Company. have also y The education and health services sector added 5,900 jobs, or committed to multi-billion-dollar investments in new and existing growth of 1.9 percent, following slower growth of 0.5 percent design and production facilities in the area. a year earlier. The sector has grown steadily, averaging 1.2 percent annually since 2010. y Declining sectors were led by the leisure and hospitality sector, After emerging from the Great Recession during which fell by 4,000 jobs, or 2.1 percent, followed by the 2010, the annual rate of job growth in the Detroit wholesale and retail trade sector, which fell by 2,600 jobs, or metropolitan area exceeded the national rate, on 0.9 percent. Executive Order 2020-5, issued by the governor of average, from 2011 through 2017, before slowing. Michigan and effective March 13, 2020, prohibited gatherings Detroit Metropolitan Area of more than 250 people and ordered the closure of non-critical Michigan Nation retail establishments in the state. 4.0 y The unemployment rate averaged 4.3 percent, down from 3.5 4.7 percent a year earlier, because resident employment grew 3.0 significantly faster than the labor force during the past year. 2.5 The city of Detroit and the Detroit metropolitan area are typically 2.0 associated with manufacturing, with a focus on automobile 1.5 manufacturing. During the first quarter of 2010, 10.1 percent 1.0 of all nonfarm payrolls in the Detroit metropolitan area were Average) (3-Month Year 0.5 manufacturing sector jobs, and 2.6 percent were in the 0.0 Percentage Change from Previous Previous from Change Percentage motor vehicle parts (MVP) manufacturing industry. Nationally, manufacturing jobs contributed 8.8 percent of nonfarm payroll Mar-2011Mar-2012Mar-2013Mar-2014Mar-2015Mar-2016Mar-2017Mar-2018Mar-2019Mar-2020 jobs during the first quarter of 2010, and MVP manufacturing industry jobs were 0.3 percent of all jobs. The concentration for Source: U.S. Bureau of Labor Statistics these manufacturing jobs increased in the Detroit metropolitan area to current levels of 12.6 and 3.8 percent for total manufacturing and MVP manufacturing, respectively, but stayed mostly stable Largest Employers in the Detroit Metropolitan Area nationally. When economic recovery following the Great Recession Nonfarm Number of Name of Employer began during 2010, demand for automobiles was at near-record- Payroll Sector Employees low levels of 11.6 million but rose to a recent high level of 17.5 Ford Motor Company Manufacturing 46,000 million during 2016. Demand has gradually declined to 17.0 Fiat Chrysler Automobiles Manufacturing 34,450 N.V. million during 2019. During 2019, the three automotive producers, General Motors Company Manufacturing 32,770 currently the largest private employers in the Detroit metropolitan area, made commitments to invest in automobile production Note: Excludes local school districts.