Michigan
UM report forecasts moderate economic growth in Michigan, nation in 2025-26
As the Federal Reserve continues to cut interest rates amid a cooling job market, the economy is poised for moderate growth in Michigan and nationally over the next two years, according to University of Michigan economists.
The national economy is projected to grow 2.3% in the fourth quarter of 2024 with the unemployment rate averaging 4.2%, while growth may ease slightly in the near future due to a slowing labor market, the UM economists said in a U.S. Economic Outlook for 2025–2026.
Meanwhile, Michigan’s economy has slowed since spring, with heightened uncertainty due to the recent elections, the economists wrote in a Michigan Economic Outlook for 2025–2026. Both reports were written by Jacob T. Burton, Gabriel M. Ehrlich, Kyle W. Henson, Daniil Manaenkov, Niaoniao You and Yinuo Zhang.
“The U.S. economy has gone through times of great uncertainty before and emerged intact,” the economists wrote. “We are projecting that both Michigan and the nation will follow that path over the next two years.”
Job growth in Michigan is expected to decline in the second half of the year, but grow moderately in 2025 and 2026.
“We believe the election results have amplified the uncertainty surrounding Michigan’s economic outlook,” the economists wrote. “We project a small dip in Michigan’s job count in the back half of 2024 to give way to moderate job gains in 2025 and 2026, but the outlook depends critically on uncertain policy decisions and the subsequent market responses.”
The economists expect job growth in the state to be strongest in health care, leisure and hospitality and government, while sectors including manufacturing and professional services are expected to remain stable.
“We are projecting the state economy to return to growth over the next two years as easier monetary policy and another round of tax cuts boost medium-term growth,” the economists wrote. “Michigan adds 19,000 payroll jobs next year and an additional 26,700 in 2026. The unemployment rate in Michigan is projected to fall from 4.6% in late 2024 to 4.3% by the end of 2026.”
The Detroit, Grand Rapids and Ann Arbor metro areas showed a downward trend in job growth, with Detroit and Grand Rapids seeing 0.1% growth during the past year. Ann Arbor saw relatively stronger job growth of 1.3% as of September, according to the report. Metro-level data for October was not available for the report, officials said.
The report attributes the underlying cause of the slowdown in Michigan’s job market as the Federal Reserve’s policy of monetary tightening to control inflation.
“Although the Fed has recently pivoted toward reducing short-term interest rates, we believe that real interest rates remain at a restrictive level and that the effects of the Fed’s past tight monetary policy continue to impact Michigan’s economy,” the economists wrote. “Indeed, in many ways, the national rebalancing in the labor market is precisely what the Fed hoped to engineer with its policy actions. Unfortunately for Michigan, our relatively rate-sensitive industry mix means that higher interest rates have taken a larger economic toll than nationally.”
The Michigan outlook points to stronger personal income growth, with per capita income increasing to $64,000 in 2024 and reaching around $68,500 by 2026, up 41% from 2019.
Inflation is expected to slow to 3.3% in 2024 and 2.2% in 2025 before increasing to 2.7% in 2026 due to new tariffs that the incoming Trump administration is expected to impose.
The U.S. and Michigan economic outlook reports follow the presidential election, which economists say will result in significant changes in U.S. economic policies. In the reports, the economists shared their thoughts on about the impacts of a second Trump administration.
The recent election of Donald Trump as well as the Republican majorities in the U.S. Senate and House will likely to result in a continuation of tax cuts Trump enacted during his first term, the economists said. Also expected is a sharp rise in tariffs on imports from China to take effect by 2026.
While rising tariffs on Chinese imports and tax cuts for corporations and individuals are expected in upcoming years, revenue increases from tariffs are unlikely to offset revenue losses generated by tax cuts, according to the report. This could result in slower revenue growth and a sharp increase in federal deficits.
“As the stimulative effects of the expected tax cuts dominate the drag from the anticipated new tariffs, we project quarterly GDP growth to accelerate modestly during 2026, reaching a 2.5 percent annualized pace by 2026 Q4,” the economists wrote.
The report notes that the Federal Reserve has started cutting interest rates after keeping them at a 23-year high of 5.25% to 5.5% for 14 months. The rate was reduced by 50 basis points in September and 25 basis points in November, bringing it to 4.5% to 4.75%.
Additional cuts will depend on economic data, with the economists expecting another 25 basis point cut in December.
Looking ahead at next year, the economists say they expect the Fed to make four more 25-basis-point cuts in 2025 and reach a range of 3.25–3.5% by the end of the year.
“In our view, the temporary uptick of inflation related to tariffs will not prompt the Fed to tighten policy in 2026,” economists wrote. “We believe that risk management concerns related to the potential negative growth effects of tariffs, which played a role in the 2019 rate cuts, will balance the upside risks from new tax cuts, prompting the Fed to stand pat.”
cwilliams@detroitnews.com
@CWilliams_DN
Michigan
Nebraska Football Opponent Preview: Michigan State
After three consecutive home games, Nebraska football will begin conference play on the road in East Lansing against Michigan State.
The Spartans, after going a combined 9-15 under Jonathan Smith in two years at the helm, are welcoming in a new head coach. Pat Fitzgerald, a familiar name to Husker fans, led the Northwestern Wildcats for 17 years, becoming one of the winningest head coaches in Big Ten history. Now, he’ll look to revive a program that went 11-2 just five years ago.
Here’s an early look at what Michigan State is expected to bring to the table this fall, including key returners, transfer additions, and what Nebraska will need to do to start 1-0 in conference play against a new regime.
Previously Covered: Ohio, Bowling Green, North Dakota
Offensive Outlook
The Spartans’ offensive struggles in 2025 were well documented, though injuries at quarterback certainly played a role. In 12 games, Michigan State finished the regular season ranked 98th nationally in total offense, averaging 345.5 yards and 24.6 points per game.
Aiden Chiles started the first eight contests of the season and provided the Spartans with a dual-threat presence each and every play. The then-junior threw for 1,392 yards and 10 touchdowns while completing 63.1% of his passes. He also added 227 rushing yards and six scores on the ground before a season-ending injury, suffered after being sacked 21 times, forced him to prematurely end the year.
That opened the door for Alessio Milivojevic, who appeared in nine games and made the first four starts of his career as a redshirt freshman. Milivojevic threw for 1,267 yards and 10 touchdowns while completing 63.8% of his attempts. Even in his limited role, however, he was sacked 16 times behind a struggling offensive line.
Following the coaching transition, Michigan State aggressively pursued the transfer portal, bringing in 45 new scholarship players ahead of the 2026 season. With a revamped roster and an attempt at improved depth, there’s at least reason for optimism that the Spartans’ offense could take a step forward this fall.
Offensive Player to Watch: Alessio Milivojevic
It’s difficult to argue that any player on Michigan State’s offense will have a greater impact on the program’s success in year one under Fitzgerald than Milivojevic. As a redshirt freshman, the Naperville (IL) native was thrown into action against some of the toughest opponents on the Spartans’ 2025 schedule and gained valuable experience as a result.
Michigan State went 1-3 across his four starts while averaging 21.25 points per game. The 6-foot-3, 223-pound quarterback averaged 246.5 passing yards per contest during that stretch, with seven of his 10 touchdown passes coming as a starter.
Now entering his third season of college football, Milivojevic is more battle-tested than ever and will likely become the centerpiece the Spartans staff leans on throughout 2026. For Nebraska, drawing him early in his first full season as the unquestioned starter could prove beneficial, even if the Huskers already saw flashes of his potential firsthand inside Memorial Stadium last fall.
Defensive Outlook
A season ago, Michigan State fielded the 72nd-ranked defense in the FBS, allowing 378.7 yards and 29.9 points per game. Those numbers are expected to be an area of improvement as the Spartans begin a new era under Fitzgerald’s guidance.
In 2025, MSU surrendered 231.3 passing yards and 147.3 rushing yards per contest while struggling to complement an offense that averaged just 24.6 points per game. The Spartans held only two conference opponents below that scoring mark all season, highlighting the inconsistency that ultimately defined Smith’s tenure in East Lansing.
Still, there’s reason to believe the roster could look significantly different in 2026. Michigan State underwent noteworthy offseason turnover, losing 51 players to the transfer portal while returning only 36 scholarship players from last year’s team. In some ways, the reset may benefit the program. A new coaching staff, a fresh scheme, and an overhauled locker room could allow the Spartans to quickly reshape their identity entering the fall. Fitzgerald has made a career doing less with more and finally has a program with competitive resources to lead.
Defensive Player to Watch: Jordan Hall
Rising senior linebacker Jordan Hall is one of the most important returning pieces for Michigan State entering 2026. The 6-foot-3, 250-pound former IMG Academy star captained the Spartans’ defense last season and earned Honorable Mention All-Big Ten recognition after leading the team with 88 tackles in 12 games. He also totaled 2.5 sacks, tied for the team lead, while adding a pass breakup, an interception, and three forced fumbles.
Hall has now appeared in 35 career games, including 19 starts, giving Michigan State a proven veteran presence in the middle of its defense. Beyond the production, his decision to remain with the program through multiple coaching changes and difficult seasons speaks volumes about his investment in the team he continually chose.
The then-junior finished 11th in the Big Ten in total tackles during the 2025 regular season and will look to build upon that production this fall. If he takes another step forward in 2026, Hall will almost certainly position himself to become an NFL draft pick, assuming he hasn’t already done so.
Biggest Question Mark Heading in 2026
Fitzgerald led Northwestern to 10 bowl appearances in 17 seasons as head coach, a noteworthy accomplishment considering the challenges tied to recruiting limitations the program has. During his tenure, the Wildcats also produced 11 All-Americans and 22 NFL Draft picks, proving Fitzgerald could develop talent at a high level despite academic restrictions that few other schools face.
Now the conversation shifts toward what he can accomplish with greater resources at Michigan State. While the Spartans have struggled in recent years, the program is not far removed from total success. Michigan State reached the four-team College Football Playoff in 2015 and won 11 games in 2021. Fitzgerald himself guided Northwestern to Big Ten Championship Game appearances in both 2018 and 2020. There’s precedent suggesting he can elevate a program within the Big Ten.
However, college football has changed dramatically since Fitzgerald last coached. The transfer portal, NIL, revenue sharing, and roster management created an entirely different landscape than he once had. Even so, Fitzgerald was selective about where he would return to coaching, and Michigan State ultimately became the program he believed in enough to take over.
The biggest question surrounding the Spartans may not be tied strictly to 2026, but rather the timeline of their rebuild overall. How quickly Fitzgerald can stabilize and reshape MSU will likely determine whether the program can once again emerge as a legitimate contender in the Big Ten.
My Outlook for the Game
Entering year four under Matt Rhule, Nebraska will need to show tangible progress as a program in 2026. The contract extension likely removes any “do-or-die” pressure surrounding the season overall, but opening conference play against a first-year head coach is still the type of game the Huskers simply cannot afford to lose.
NU will, in all likelihood, enter the matchup as the favorite despite being on the road. Now the challenge becomes proving the oddsmakers right in doing so. Staff continuity, roster depth, and overall culture should all work in the Big Red’s favor heading into the game against Michigan State. The Huskers need to capitalize on those advantages.
Starting 1-0 in conference play feels especially important, knowing the schedule only becomes more difficult to follow. This doesn’t project to be a game Nebraska will run away with, but the Huskers already found a way to beat Michigan State in 2025 despite surrendering five sacks. There’s little reason to believe they can’t do it again this fall.
Ideally, NU’s offensive line takes a step forward, and the team plays a cleaner, more disciplined brand of football overall. If that happens, the Huskers should like their chances. It may not come easy, but among Nebraska’s conference matchups in 2026, this remains one of the more favorable opportunities on the schedule. Find a way to get the job done.
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Michigan
Michigan house explosion leaves 1 dead and another in critical condition
PLAINFIELD TOWNSHIP, Mich. (AP) — A Michigan house explosion early Tuesday left one person dead and one in critical condition, authorities said.
Authorities have not yet determined what caused the fire and explosion, which happened around 4 a.m. in Plainfield Township, north of Grand Rapids.
When authorities arrived, the home was destroyed and the debris was on fire, according to the Kent County Sheriff’s Office. One person was dead.
Two neighbors pulled a woman out of the home after hearing her yelling.
“I had to get in there and get her out,” one of the neighbors, Tim Johnson, told WOOD-TV. He said they “grabbed her arms and pulled her out as far as we could.”
The woman was taken to a hospital in critical condition.
The blast shook Johnson’s house and he had second-degree burns on his head and a hand.
Michigan
Michigan gas prices fall 20 cents from last week, AAA says
General contractor Jordan Yagiela not loving higher gas prices
Jordan Yagiela, who runs a construction business, comments on the increase in gas prices at a work site in Detroit on May 15, 2026.
Michigan gas prices fell 20 cents from last week to an average of $4.63 per gallon for regular unleaded, AAA said Tuesday.
“Michigan drivers are getting some relief at the pump, with gas prices falling 20 cents over the past week,” Adrienne Woodland, a spokeswoman for AAA-The Auto Club Group, said in a statement.
However, the company said demand for gasoline is up, and both supply and production are down, citing the latest data from the Energy Information Administration.
Demand increased from 8.75 million barrels per day to 8.76 million, according to the federal agency. The total domestic gasoline supply fell from 215.7 million barrels to 214.2 million barrels while production dropped last week, averaging 9.3 million barrels per day.
AAA also said the price of crude oil has risen while inventories are down. The price of crude was up 25 cents to $96.60 a barrel at the end of Friday’s formal trading session. Furthermore, the Energy Information Administration reported inventories fell 7.9 million barrels from the previous week. U.S. crude oil inventories are at 445 million barrels, about 2% below the five-year average for this time of year.
“While the recent drop is welcome, continued volatility and higher crude oil prices could quickly push pump prices higher again,” Woodland said.
The state’s average price of regular unleaded gasoline is 63 cents higher than it was at the same time last month and $1.42 more than a year ago, AAA said.
The company also said Michigan motorists are paying about $69 for a full 15-gallon gasoline tank, which is about $18 more than 2025’s highest gas price in August.
In Metro Detroit, the average daily price per gallon is down to $4.63, about 15 cents less than last week’s average, but $1.47 more than at this same time in 2025, according to AAA.
The company said the state’s most expensive gas can be found in Jackson at $4.74 per gallon, in Grand Rapids at $4.67 per gallon, and in Ann Arbor, also at $4.67 per gallon. The cheapest is in Marquette at $4.36 a gallon, Lansing at $4.50 a gallon, and Flint at $4.50 a gallon.
Nationally, a gallon of regular unleaded gas costs an average of $4.51, according to AAA. The price is down a cent from a week ago and up $1.33 from last year.
cramirez@detroitnews.com
X: @CharlesERamirez
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