The State of Black Detroit is Key to Detroit’s Economy
May 24, 2023
Detroit’s economy is moving in the right direction, despite national economists’ projections of mild recession-like conditions in the United States over the ensuing months. According to a Detroit Economic Outlook forecast completed by the University of Michigan earlier this year, Detroit’s economy is projected to continue growing at a steady pace.
“We expect Detroit’s resilience in recovering from the pandemic to date to translate into continued growth – even amid a challenging economy,” said Gabriel Ehrlich, director of the University of Michigan’s Research Seminar in Quantitative Economics and lead author of the forecast.
For African Americans in Detroit, the nation’s “biggest and blackest” municipality, the economic engine is powering forward as high employment rates in communities across the city have come down significantly. The National Bureau of Labor Statistics released a report in March 2023 stating Detroit’s unemployment rate fell to 5.8%, the lowest in 23 years.
Helping to attack high unemployment numbers in Detroit, a city that’s 82% Black, are comprehensive and targeted training and employment initiatives available to the city’s adults seeking opportunities to work. One of the leaders in linking Detroiters with jobs and employers with talent in the city is Detroit At Work, a city agency offering training and employment opportunities. Detroit At Work has been intricate in preparing Detroiters for jobs in-demand fields such as health care, information technology, advanced manufacturing, construction and skilled trades, and the expanding automotive sector.
Through Detroit at Work, dozens of companies in Metro Detroit are giving Detroiters the first opportunities to fill good-paying jobs. Such companies include, but are not limited to, General Motors, Ford, Stellantis, Amazon, Google, Apple, and more.
And for those who believe there are no good jobs in Detroit to help drive the economy, Detroit At Work’s website lists the number of jobs available each day in the region. On Tuesday, May 23, 2023, the daily indicator listed 7,272 available positions.
Another critical component to the growth of Detroit’s Black economy is linked to the 50,000 plus small Black business owners navigating opportunities afforded through entrepreneurship.
“Supporting Black-owned businesses and entrepreneurship is critical to the economic growth and vitality of Detroit,” Sandy K. Baruah, president and CEO of the Detroit Regional Chamber, said in a statement. “We need to do more to provide access to capital, resources, and opportunities for Black entrepreneurs and businesses.”
Across the city, many Detroit leaders and organizations are working to provide needed resources and support to Black small businesses and entrepreneurs, including Detroit Economic Growth Corporation (DEGC), Black Leaders of Detroit, Metro-Detroit Black Business Alliance, JPMorgan Chase (Invested in Detroit), the National Business League, Detroit Action, and more.
“Small businesses are the heartbeat of Detroit, driving innovation, creating jobs, and fostering a sense of community that is essential to the city’s survival,” said DEGC President and CEO Kevin Johnson, whose organization manages small business development and support programs such as Motor City Match and Detroit Means Business. “Supporting these entrepreneurs is not only an investment in the local economy but a commitment to the spirit and resilience of Detroit itself.”
Among the city’s Black entrepreneurs are several dozen developers making news, building, renovating, or facilitating mixed-use projects in Detroit City Limits. Like other Black entrepreneurs in the city, acquiring access to capital is critical for many Black developers, especially when it’s the bloodline to starting, sustaining, and completing respective residential and commercial projects around town.
Recognizing the importance of having access to capital/financial support, many local and national organizations are finding ways to help, including Black Leaders of Detroit, DEGC, Detroit Action, JP Morgan Chase, Capital Impact Partners, The Kresge Foundation (Ebiara Fund), Invest Detroit, and more.
In addition to strong and rising employment and entrepreneurship numbers in Detroit, if Detroit’s Black economy is to grow and prosper, it must include viable solutions to helping Detroiters acquire affordable housing options in the neighborhoods, downtown, and midtown.
“How we address the housing inequities that will inevitably arise from Detroit’s revitalization will ultimately determine if the growth we’re experiencing is sustainable,” said City Council President Mary Sheffield. “Through the Inclusionary Housing Ordinance that my office sponsored, I’ve worked to actively address the growing need for affordable housing and the inclusion of all Detroiters in the city’s future.”
Some organizations assisting Detroiters in their quests for affordable housing include the Detroit Housing Commission, established in 1933. According to its website, the Commission is the largest owner of rental housing in Detroit. Nevertheless, “homeownership” is one of the biggest drivers of generation wealth, which has prompted Rocket Mortgage and the Detroit Housing Network to partner and offer Detroiters access to the resources needed to buy affordable homes.
Last summer, Mayor Mike Duggan and City Council members Mary Waters, Latisha Johnson, and Angela Calloway announced a seven-point, $203 million affordable housing plan to increase housing services to Detroit residents, rehabilitate affordable housing, streamline approval processes, and provide down-payment assistance to new homeowners.
However, perhaps the biggest challenge Detroit faces is rooted in the ultra-high poverty rate, which almost a third – or more – of Detroiters are linked to.
According to a report by the Urban Institute, Detroit, in 2019, had the highest rate of extreme poverty in the United States, with more than 25% of its residents living below the poverty line. And since then, nothing much has changed to combat the generational poverty crippling Black adults and children living in the city.
In 2021, according to WalletHub, a financial wellness watchdog organization based in Florida, of 182 American cities surveyed for their respective financial needs, Detroit ranked as the neediest. Fox 2 Detroit carried the story that focused on the city’s economic disadvantages, most notably child and adult poverty rates, homelessness, and food insecurity.
While many organizations are fighting to change the poverty level across the city that has festered in Detroit for generations, Poverty Solutions at the University of Michigan and the Detroit Urban Research Center have collaborated to jointly fund opportunities for the University of Michigan’s three campuses to link with community-based partners to evaluate and strengthen intervention programs and policies to alleviate poverty in Detroit and other parts of the state.
For Detroit’s economy to truly prosper, the city’s economic picture must vigorously, consistently, and equitably be “painted in Black,” devoid of the high percentage of generational poverty. And historic barriers of systemic racism across all segments of life in Detroit must be removed. Detroit’s economy is at its best when Black Detroiters are “equally vested and included” in the Motor City’s masterplan – now and the future. To be successful, it will take collective efforts by city, civic, and community leaders and organizations, businesses, educators, and faith-based and philanthropy entities. It will demand engaging in meaningful dialogue and action to reach common goals that will advance the underserved to be a part of Detroit’s bright future.
“The success of Detroit’s economy depends on the success of all of our residents,” Duggan said. “By prioritizing the needs of Black Detroiters and working to create a more equitable and inclusive economy, the city can build a brighter future for all its residents. We are building a city where people of all incomes are welcome in all neighborhoods.”