The insurance industry is a vital part of the Michigan economy and has been a relatively recession-proof source of stable, well-paying jobs. In the most recent report from the Bureau of Labor Statistics (BLS), the net job loss during 2009 – .17 percent – was far less than many other sectors in the U.S. economy. In addition, the BLS projects that between 2012 and 2018, employment in the insurance industry will grow by 9 percent, which in Michigan would be approximately 5,000 jobs. With forty percent of the employees in insurance-related occupations earning $40,000 to $60,000 annually in an industry that has been largely recession-proof and poised to grow, the insurance industry is an important economic growth engine for Michigan.
Insurers provide significant revenue to the state through taxes. In fact, during the debate on the Michigan Business Tax, it was noted the taxes that Michigan insurance companies paid were more than four times their share of gross state product.
The insurance industry also plays a critical role in the state’s economy by providing security to individuals and businesses, protecting them against unexpected large losses. The benefits are not just in the replacement of lost property, but also in the stability provided by the replacement of revenue and compensation during times of crisis.
Given the current state of the economy, Michigan should be trying to attract and retain insurance companies in order to grow jobs and increase tax revenues. Unlike other groups that come to Lansing to ask to use government to create competitive advantages in the marketplace, MIC merely asks government to get out of the way – its members want to compete on a level playing field without unnecessary regulations, taxes and mandates that choke-out competition.
- Insuring the Future: The Economic Importance of the Insurance Industry in Michigan, GSP Consulting Corporation, 2007
- A Brief Analysis of Insurance Industry Share of State of Michigan Business Tax, Gary Wolfram, Ph.D., November 14, 2006.