State sees $1.68 billion revenue boost, signaling sustained economic momentum heading into 2025.
LANSING, Mich. — Michigan’s economy is thriving, with state revenue projections significantly exceeding expectations. The Consensus Revenue Estimating Conference (CREC) revealed on Friday that the state will collect $770 million more than expected in Fiscal Year (FY) 2025 and an additional $910 million in FY 2026, bringing an extra $1.68 billion over the next two years. The announcement comes days before Governor Gretchen Whitmer’s “Road Ahead Address” at the Detroit Auto Show, where she is expected to outline plans to sustain and build on this economic momentum.
Revenue Growth Driven by Robust Economic Indicators
Michigan’s revenue forecast reflects the state’s economic strength. Unemployment remains below 5% for the 37th consecutive month, labor force participation has reached a 25-year high, and construction jobs are at their highest levels in 22 years. In addition, the state’s gross domestic product (GDP) has grown by 35% since 2019, and median household incomes have increased by nearly $13,000 over the same period.
“This growth is no accident,” said Governor Whitmer. “Our hardworking people, innovative businesses, and strategic financial management are driving Michigan’s economy in the right direction. We’re building a stronger foundation for families and businesses alike.”
Breakdown of Revenue Increases
The revenue boost is spread across Michigan’s General Fund and School Aid Fund:
- General Fund: Revenue will rise by $457.7 million in FY 2025, reaching $14.72 billion, and by $591.2 million in FY 2026, totaling $15.48 billion.
- School Aid Fund: Revenue will increase by $312.7 million in FY 2025, bringing the total to $18.46 billion, and by $319 million in FY 2026, reaching $18.89 billion.
Initial projections for FY 2027 also show continued growth, with a combined revenue forecast of $35.1 billion.
Policy Successes and Future Plans
State officials attribute the revenue increase to effective governance and bipartisan policies. Governor Whitmer emphasized that these results build on six years of progress, including $1 billion in tax cuts for seniors and working families, expanded school meal programs, and investments in affordable housing and childcare.
“As we move into 2025, we’ll double down on our efforts to lower costs for Michiganders, reinvest in our workforce, and grow our businesses,” Whitmer said.
Chair of the Michigan Democratic Party Lavora Barnes echoed the sentiment, stating, “Michigan Democrats are proving that fiscal responsibility and community investments go hand in hand. We’ve built a thriving economy, and this revenue forecast underscores that our agenda is working.”
Republicans Urged to Support Progress
Barnes also called on Republican lawmakers, including House Minority Leader Matt Hall, to join efforts to sustain Michigan’s economic growth. “It’s time for Republicans to stop obstructing and start contributing. Michiganders deserve bipartisan support to keep this momentum going,” Barnes added.
Broader Economic Context
Michigan has consistently been ranked as a top-10 state for doing business by CNBC and Area Development Magazine, thanks to policies fostering innovation and job creation. The state’s rainy-day fund has reached an all-time high of $2 billion, providing a safety net for future economic uncertainties.
Governor’s Vision for 2025
Governor Whitmer’s upcoming address at the Detroit Auto Show is expected to highlight plans to sustain Michigan’s economic growth. She will likely focus on initiatives to create high-paying jobs, invest in infrastructure, and ensure economic equity for all residents.
Related Developments
As Michigan celebrates its economic gains, other states in the Midwest face slower growth and budget deficits, underscoring the success of Michigan’s strategic approach. With a strong foundation in place, the state is positioned to continue leading the region in economic innovation and resilience.
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