Industry leaders say Michigan is not the best place to start or operate a technology firm

July 28, 2008

DEARBORN / July 28, 2008---Industry leaders in southeastern Michigan say Michigan is not the best place to successfully start or operate a technology firm, according to a survey conducted by the University of Michigan-Dearborn School of Management.

“Sixty-nine percent of the people we surveyed say the business environment for technology firms in Michigan is worse than in other states,” according to Timothy Davis, project director at the UM-Dearborn School of Management. “Few of them think the situation has improved in the past six months, but 28 percent think conditions will improve in 2008.”

The survey was conducted by the UM-Dearborn School of Management’s iLabs, or Center for Innovation Research, in collaboration with the Detroit Regional Chamber. The researchers contacted 296 technology leaders and 77 of them participated in the 22-question online survey.

The purpose of the project was to get opinions from the region’s technology executives about the Michigan business climate for technology firms, Davis said. “These are metro Detroit-based companies, with 94 percent located in Wayne, Oakland, Washtenaw, or Macomb counties.”

Industries represented include software and information technology, engineering services, business services, environmental engineering and energy, communications, and advanced manufacturing services and research and development. More than three-quarters of the respondents identified their title as president, chief executive officer, chief operating officer or vice president.

Among other findings, the responses show opportunities for the state to make improvements to encourage technology firms, Davis said.

The executives do not express confidence in the state’s ability to promote economic growth and entrepreneurial development. Only 12 percent said that believe that Michigan’s tax policy promotes entrepreneurship, and only 22 percent said the state effectively promotes economic development.

On the other hand, 61 percent of them said that a regional transit system in the metropolitan area would have a positive effect on the state’s overall economy.

The technology executives who responded to the survey also said that while skilled technology workers are a strength of Michigan’s workforce, less than half the executives said the state’s labor force meets their firm’s needs, according to the report.

An overwhelming majority of the executives surveyed, 85 percent, “feel that shifting from a manufacturing-based technology to a knowledge-based economy is essential to Michigan’s success,” Davis said.

And somewhat paradoxically, while 82 percent think reducing the dependence on the automotive industry will help the state’s economy, “64 percent of the respondents feel that this industry is vital to Michigan’s long-term economic future,” according to the study.




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