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New-model economy emerges in Michigan

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There really is a new economy in Michigan, but not everyone knows it yet. Especially everyone in Michigan. People here still say simply ''the Big Three,'' instead of ''the Big Three automakers,'' as they say in the rest of the country. But there is a new awareness that the automobile industry, while still important, is not the whole of the Michigan economy.

Higher education and abundant natural resources (especially forests) seem important to the state's future. And across the state are found entrepreneurial sparks that business, academic, and government leaders are fanning.

''People here are either excited about the progress or frustrated that it's not happening faster,'' says George Gamota, director of the Institute for Science and Technology (IST) at the University of Michigan campus here.

He speaks of ''tremendous changes'' in people's attitudes toward the ''new economy'' over just the past few years: ''Three years ago, there was a tremendous glum. We had our annual conference - and it was like a wake.'' That has changed as the state has snapped back economically, largely due to the dramatic turnaround in autos.

The recovery in autos is important for a number of reasons, not least of which is that this industry is likely to be the principal market for many of Michigan's new technology-based companies. But a cyclical upturn in traditional manufacturing industries does not obviate the need for long-term structural change, which, economists say, hasn't happened yet.

Dr. David E. Birch, director of the Massachusetts Institute of Technology program on neighborhood and regional change, notes that Michigan unemployment remains high, 11.5 percent in July, seasonally adjusted (''And that's with autos back,'' he notes). Recovering businesses have sprung back with more automation and overtime and less new hiring.

Dr. Birch, who studies the process of job creation, predicts that ''in five or six years Michigan will be back to or below national unemployment rates.'' He adds, however, that ''the auto industry will not return to the employment levels of 1980.''


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