Comerica Bank's Michigan Index Sees Biggest Boost in Four Months

DETROIT — Comerica Bank’s Michigan Economic Activity Index improved in November, rising 0.6 percent to a level of 127.9. October’s index reading was 127.2.

The Michigan Economic Activity Index consists of eight variables, as follows: nonfarm payrolls, exports, hotel occupancy rates, continuing claims for unemployment insurance, housing starts, sales tax revenues, home prices, and auto production. All data are seasonally adjusted, and indexed to a base year of 2008. Nominal values have been converted to constant dollar values. Index levels are expressed in terms of three-month moving averages.

“Our Michigan Economic Activity Index increased again in November, marking two consecutive monthly gains after flatlining from July through September,” Comerica chief economist Robert Dye said. “Job growth, while still a positive factor for the Michigan economy, appears to be easing with year-over-year growth of 1.9 percent in December, converging to the U.S. average. Most index components were positive in November, including unemployment insurance claims … housing starts, house prices, sales tax revenue and hotel occupancy. State exports and auto production were negatives in November. We expect strong consumer demand for new automobiles to continue through 2016, however, auto production and auto-related employment is likely near its cyclical peak, so the boost to the state economy from the resurgent auto industry will diminish going forward.”

November’s reading is 54 points, or 73 percent, above the index cyclical low of 74.1, reached at the bottom of the 2007-09 recession.

The index averaged 117.4 points for all of 2014, three and three-tenths points above the index average for 2013.

To subscribe to Comerica’s economic publications or for questions, contact us at ComericaEcon@comerica.com. Archives are available at http://www.comerica.com/economics.

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