Detroit is anticipated to experience a rise in employment, salaries, and resident job opportunities in the coming five years—promising indications for a city that emerged from bankruptcy just over ten years ago and has been in a recovery phase following the COVID-19 pandemic.

Economists from the University of Michigan express that they “remain optimistic about the trend of wages and salaries” in the City of Detroit Economic Outlook for 2024-2030.

Key points include:

• Wage advancement for jobs situated in the city is expected to average 3.2% per year from 2025 through 2030, surpassing the overall rate for the state of Michigan. When adjusted for local inflation, the average real wages for Detroit residents are projected to rise by 4.9% in 2030 compared to 2019. Although this may appear modest, it exceeds the growth of average real wages at Michigan and Detroit workplaces.
• Detroit is poised to generate an average of 1,500 payroll jobs annually during the forecast period, reflecting an annual growth rate of 0.6%. Economists predict resident employment to increase by an average of 0.4% yearly. The slightly slower growth in resident employment signals a robust recovery since the pandemic, limiting the capacity for catch-up growth.
• Detroit’s jobless rate is projected to continue its upward trend through the first half of 2026, reaching 10.2% in the second quarter. Michigan’s unemployment rate is expected to peak at 6% during the same timeframe. The forecast indicates that both the city and state unemployment rates will decrease in subsequent years as lower interest rates permeate the economy. By 2030, Detroit’s unemployment rate should drop to 8.9%, while Michigan’s rate will decrease to 5.6%.
• The quantity of jobs in Detroit establishments is anticipated to recover to its pre-pandemic level by the second quarter of 2026, with researchers estimating it will rise to 3.1% above that level by the end of 2030. Resident employment is expected to exceed its pre-pandemic level by 4.5% by the conclusion of 2030 and surpass its 2023 peak by 1.4%.
• Increased tariffs will affect employment within Michigan’s transportation equipment manufacturing sector over the next few years. Modest expectations for statewide growth in the automotive industry contribute to the forecast for Detroit’s economy. Sectors projected to witness job increases during the forecast period include finance, leisure and hospitality, and public administration.

Another encouraging indicator highlighted by the researchers is more demographic than economic: Detroit’s population grew by 1.7% from 2022 to 2024, outpacing the state’s overall growth rate of 0.9%. The city had the fourth-fastest growth among all large cities in the Midwestern Great Lakes region over the past two years, outdoing Pittsburgh, Chicago, Cincinnati, Indianapolis, and Minneapolis-St. Paul.

“We believe Detroit’s stronger foundation bodes well for its economic performance in the coming years,” the economists state in their report. “However, the outlook is murky due to a significant degree of uncertainty regarding the direction of economic policy.”

The forecast was crafted by the university’s Research Seminar in Quantitative Economics as part of the City of Detroit-University Economic Analysis Partnership between U-M, the city of Detroit, Michigan State University, and Wayne State University.

Authored by Jeff Karoub, Michigan News