AN INTRODUCTION TO DEDICATED TO MAKING MICHIGAN A TOP TEN STATE FOR JOBS, PERSONAL INCOME AND A HEALTHY ECONOMY.

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1 AN INTRODUCTION TO DEDICATED TO MAKING MICHIGAN A TOP TEN STATE FOR JOBS, PERSONAL INCOME AND A HEALTHY ECONOMY.

2 THE ECONOMIC SCOPE OF DEDICATED TO MAKING MICHIGAN A TOP TEN STATE FOR JOBS, PERSONAL INCOME AND A HEALTHY ECONOMY.

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4 Introduction In 2009, Business Leaders for Michigan (BLM) was created by uniting business leaders across the state to form Michigan s first state business roundtable focused on one goal making Michigan a Top Ten state for jobs, personal income and a healthy economy. Our organization provides a forum for the state s top business and education thinkers to set in motion a bold plan for harnessing positive change in our state. Our work is defined by the Michigan Turnaround Plan, a holistic, fact-based strategy to get Michigan s economy back on track and to sustain our recovery. Business Leaders for Michigan s board members head up the state s largest job providers and universities, but our economic impact is far greater than the nearly 375,000 people that work directly for these enterprises in Michigan. This document outlines the findings of an independent assessment conducted by Anderson Economic Group that defines the scale of our economic impact on the state of Michigan. 1 The results of this study conclude that BLM member companies and universities: Employ people in almost every county of the state Generate more than $1 trillion in annual revenue and serve over 138,000 students Drive nearly one-third of the private sector economy Support 11% of total Michigan private-sector employment through direct job creation Spend $31 billion on wages and benefits, more than 50% higher than the average private sector compensation in Michigan Contribute approximately $1 billion in state income tax revenue Business Leaders for Michigan members work here, live here, and raise their families here. We are the companies that you and your neighbors have been served by or worked for for years. We hope this report gives you a better understanding of our commitment to Michigan and the role we play in helping accelerate our state s growth.

5 Who is Business Leaders for Michigan (BLM)? Business Leaders for Michigan s approximately 80 board members head up the largest businesses and universities in Michigan. Our members are homegrown and, in many cases, have been part of the state s economic landscape for generations. Together, they drive 32% of the state s economy, generate over $1 trillion in annual revenue and serve nearly one half of all Michigan public university students. Our private sector employers span all segments of the economy, from construction and utilities to manufacturing and finance. The largest sectors among BLM members are manufacturing, finance and education. 2 Our universities enroll over 138,000 students, or 46% of the total enrollment in Michigan public institutions of higher learning. BLM Companies by Sector Manufacturing 38% Financial activities 22% Professional and business services 12% Trade and transportation 9% Leisure, hospitality, and other services 9% Education 4% Utilities 2% Construction 3% Information 1% BLM Jobs by Sector Manufacturing 41% Financial activities 14% Professional and business services 3% Trade and transportation 16% Leisure, hospitality, and other services 4% Education 17% Utilities 5% Construction 0% Information 0%

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7 Business Leaders for Michigan Board of directors JEFF M. FETTIG CHAIR OF THE BOARD Chairman & CEO Whirlpool Corporation TERENCE E. ADDERLEY Executive Chairman of the Board Kelly Services, Inc. KEITH J. ALLMAN Masco Corporation G. MARK ALYEA President Emeritus Alro Steel Corporation GERARD M. ANDERSON Chairman & CEO DTE Energy DAVID W. BARFIELD Chief Executive Officer The Bartech Group, Inc. MARY BARRA Chief Executive Officer General Motors Company ALBERT M. BERRIZ Co-Managing Member, CEO, Board Member & Co-Owner McKinley, Inc. MARK J. BISSELL Chairman & CEO BISSELL Inc. LAURENT BRESSON President & COO Nexteer Automotive JOHN C. CARTER President, Michigan Middle Market Chase DAVID C. DAUCH Chairman, American Axle & Manufacturing RICHARD L. DeVORE Executive Vice President President, Detroit & Southeast Michigan PNC Financial Services Group DOUG DeVOS President Amway ALESSANDRO P. DiNELLO Flagstar Bank STEFAN O. DOERR Senior VP, Monomers Division, North America BASF Corporation J. PATRICK DOYLE Domino s Pizza JAMES E. DUNLAP Senior Executive VP, Director of Regional & Commercial Banking Huntington MATTHEW B. ELLIOTT Michigan Market President & Market Executive, Global Commercial Banking Bank of America WILLIAM CLAY FORD, JR. Executive Chairman Ford Motor Company DAN GILBERT Founder & Chairman Quicken Loans CHRISTOPHER ILITCH Ilitch Holdings, Inc. MICHAEL J. JANDERNOA Board of Directors Perrigo Company MILES E. JONES Co-Chairman of the Board Dawn Food Products, Inc. HANS-WERNER KAAS Senior Partner & Director McKinsey & Company ALAN JAY KAUFMAN Chairman, Kaufman Financial Group JAMES P. KEANE Steelcase Inc. JOHN C. KENNEDY Autocam Medical STEPHEN M. KIRCHER, Boyne Eastern Operations Boyne Resorts WILLIAM L. KOZYRA Chairman, CEO & President TI Automotive BLAKE W. KRUEGER Chairman of the Board, CEO & President Wolverine World Wide, Inc. BRIAN K. LARCHE Chairman, CEO & President Engineered Machined Products, Inc. GREGORY J. CRABB Amerisure Insurance Company ROBERT S. CUBBIN Meadowbrook Insurance Group, Inc. WALTER P. CZARNECKI Executive VP & Director Penske Corporation KURT L. DARROW Chairman, La-Z-Boy Incorporated DAVID GIRODAT Fifth Third Bank- Eastern Michigan DAN GORDON Chairman of the Board Gordon Food Service, Inc. RONALD E. HALL Bridgewater Interiors, LLC RICHARD G. HAWORTH Chairman Emeritus Haworth, Inc. TIMOTHY D. LEULIETTE Visteon Corporation ANDREW N. LIVERIS President, Chairman & CEO The Dow Chemical Company KEVIN A. LOBO Stryker Corporation DANIEL J. LOEPP Blue Cross Blue Shield of Michigan

8 EVAN D. LYALL Chief Executive Officer Roush Enterprises, Inc. BEN C. MAIBACH III Chairman & CEO Barton Malow Company DENNIS MANNION Palace Sports & Entertainment RICHARD A. MANOOGIAN Chairman Emeritus Masco Corporation FLORINE MARK The Weight Watchers Group, Inc. CHARLES G. McCLURE Managing Partner Michigan Capital Partners, LP DAVID E. MEADOR Vice Chairman & CAO DTE Energy HANK MEIJER Co-Chairman & Co-CEO Meijer, Inc. MICHAEL MILLER Head of Ann Arbor Office & Director of Business & Industrial Markets Google, Inc. FREDERICK K. MINTURN MSX International PAUL J. MUELLER President Midwest Region The Hanover Insurance Group MARK A. MURRAY Co-CEO Meijer, Inc. JAMES B. NICHOLSON PVS Chemicals, Inc. WILLIAM U. PARFET Chairman & CEO MPI Research CYNTHIA J. PASKY Founder, Strategic Staffing Solutions ROGER S. PENSKE Chairman Penske Corporation WILLIAM F. PICKARD Chairman & CEO Global Automotive Alliance, LLC SANDRA E. PIERCE Vice Chairman, FirstMerit Corporation Chairman & CEO, FirstMerit Michigan CHARLES H. PODOWSKI The Auto Club Group JOHN RAKOLTA, JR. Chairman & CEO Walbridge MICHAEL T. RITCHIE President, Comerica Bank- Michigan Market Comerica Bank DOUG ROTHWELL Business Leaders for Michigan ANDRA M. RUSH Founder & Chairperson Rush Group Family of Companies JOHN G. RUSSELL CMS Energy & Consumers Energy MARK S. SCHLISSEL President University of Michigan J. DONALD SHEETS Executive VP & CFO Dow Corning Corporation LOU ANNA K. SIMON, Ph.D. President Michigan State University SAM SIMON CEO & Chairman Simon Holdings MATTHEW J. SIMONCINI President, CEO & Director Lear Corporation BRIG SORBER Chief Executive Officer Two Men And A Truck/International, Inc. ROBERT S. TAUBMAN Chairman, Taubman Centers, Inc. GARY TORGOW Chairman Talmer Bancorp, Inc. HOWARD UNGERLEIDER Chief Financial Officer The Dow Chemical Company SAMUEL VALENTI III Chairman of the Board TriMas Corporation STEPHEN A. VAN ANDEL Chairman Amway BRIAN C. WALKER Herman Miller, Inc. THOMAS J. WEBB Executive VP & CFO CMS Energy & Consumers Energy THOMAS G. WELCH, JR. Fifth Third Bank- Western Michigan GIL WEST Executive VP & COO Delta Air Lines, Inc. M. ROY WILSON President Wayne State University ROGER J. WOOD Dana Holding Corporation WILLIAM C. YOUNG Chief Executive Officer Plastipak Holdings, Inc. This list represents the board members at the time of printing. For a current list, visit businessleadersformichigan.com 5

9 What We Do BLM s work is concentrated on developing strategy, raising awareness, advocating policy and championing initiatives that grow the state s economy. Our work is defined by the Michigan Turnaround Plan, a holistic, fact-based strategy to get Michigan s economy back on track and sustain it. Our organizational activities are guided toward achieving the goals outlined in the Plan and we hold ourselves accountable for results. For example, we post our annual work agenda online so policymakers and the public can see where we are going. We are continually researching and benchmarking new data and strategies to see how Michigan ranks in all areas of competitiveness compared to that of Top Ten states. Michigan Turnaround Plan 6 The Michigan Turnaround Plan is a three-step agenda to make Michigan a Top Ten state for jobs, personal income and a healthy economy. The Plan sets forward the case for change, targets achievable goals, identifies action steps and explains the potential impact of change. It details what work is necessary to further strengthen our state s competitiveness and put our state on a solid path to prosperity. The Plan includes the New Michigan strategy, which identifies existing Michigan assets that we believe, based on solid data, can be leveraged to accelerate job growth and transition to a New Michigan economy over the next 10 years. By capitalizing on our core strengths, we have the potential to add up to 230,000 jobs and grow the personal income of each Michigan resident by as much as $14,000 during the same time period. What Motivates Us Our investment in Michigan is more than financial it s personal too. Our members work here, live here and raise our families here. We are the companies that you and your neighbors have worked for or have been served by for years. All across Michigan, our members are supporting communities and working to revitalize the state s economy. They walk the talk of private sector leadership by creating local jobs, reinventing neighborhoods and downtowns, and encouraging innovation in all that they do.

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11 Jobs at BLM Companies The companies and universities that make up Business Leaders for Michigan employ nearly 375,000 people in Michigan, equivalent to 11% of the state s private-sector workforce. Our companies have employees in almost every county in the state. Gogebic Ontonago Business Leaders for Michigan companies provide well-paying jobs. The estimated average annual wage for employees at BLM member companies is over $68,000 a year. These employees also receive over $15,000 a year in benefits, on average, for a total average compensation of $83,000 per employee. This is more than double 8 the average compensation of private sector employees in Michigan and 40% higher than the nationwide average compensation. Wages paid to BLM company employees make up 15% of all private sector wages and salaries in the state. Benefits paid to BLM company employees make up over 25% of all benefits paid to private sector employees in Michigan. $90,000 Average Annual Compensation of BLM Employees $80,000 $70,000 $60,000 $50,000 $40,000 $83,234 $53,116 $56,738 $30,000 $20,000 $10,000 Business Leaders for Michigan Michigan Private Sector United States Private Sector

12 Keweenaw Number of Employees at BLM Companies by County Houghton n Baraga Luce Chippewa Marquette Alger Schoolcraft Mackinac Chippewa Iron Dickinson Delta Menominee Charlevoix Emmet Cheboygan Presque Isle Charlevoix Antrim Otsego Montmorency Alpena Number of Employees in and less 1,000-4,999 5,000-9,999 10,000-19,999 40,000 and more Mason Oceana Leelanau Benzie Manistee Muskegon Berrien Grand Traverse Lake Newaygo Ottawa Wexford Allegan Cass Kent Kalkaska Osceola Mecosta Barry Kalamazoo Van Buren Clare Isabella Montcalm Ionia Crawford Roscommon Missaukee St. Joseph Eaton Calhoun Branch Gratiot Clinton Oscoda Gladwin Ogemaw Midland Bay Ingham Jackson Hillsdale Arenac Saginaw Shiawassee Alcona Iosco Lenawee Genesee Livingston Tuscola Washtenaw Oakland Huron Lapeer Monroe Wayne Sanilac St. Clair Macomb 9

13 Economic Impact of BLM Companies in Michigan The economic scope of Business Leaders for Michigan companies extends beyond their own employees and compensation. As they spend money at businesses throughout the state and hire local Michigan workers, they support industries statewide. We estimate that throughout the state of Michigan $53 billion in earnings (32% of private sector earnings) is supported by the economic activities of BLM member companies. 10 $53 Billion in earnings Other Business Activity In 2013, BLM companies spent $47 billion in Michigan on goods and services in addition to the $31 billion spent on wages and benefits for their employees. Their nonpayroll expenditures are equivalent to 12% of the state s entire economic activity (as measured by gross state product). Also in 2013, BLM employees paid an estimated $1 billion in state income taxes on compensation received. This represents almost 15% of total state income tax paid in that year. Finally, BLM companies had over $1 trillion in total revenue in 2013.

14 We all have a role in bringing Michigan back BLM works hard to encourage others in Michigan businesses, policymakers, grassroots organizations, and taxpayers to play a role in actively building our state s economic recovery. Our outreach efforts include educating the public through annual Leadership Summits, regional forums and events. BLM also operates two political action committees to support state and local level candidates who support the Michigan Turnaround Plan. A Commitment and a Promise We commit to serving as a catalyst, advocate and champion to transform Michigan s economy. We believe that a vibrant Michigan economy will make our state a place where business wants to invest and people want to live and work. 11 We promise to sustain our effort for the long-term and take an active role in leading this transformation. We will work beyond political terms to sustain the effort. We will focus on achieving the Michigan Turnaround Plan goals and welcome different ideas for achieving them. Learn more about Business Leaders for Michigan at businessleadersformichigan.com and about our plan for turning the state around at michiganturnaroundplan.com.

15 Methodology This report was prepared for Business Leaders for Michigan by Anderson Economic Group, LLC. The data presented in this report is from several sources. All BLM member companies were sent a detailed survey, requesting information on industry, employment, wages, benefits, nonpayroll expenses, and total revenue in Michigan. 12 Nearly 63% of companies responded to the survey. Respondents represented over 72% of total employment among BLM members, according to our estimates. AEG estimated missing data based on industry averages, annual reports of publiclytraded companies, other companies survey responses, and survey responses from a similar survey administered to BLM members in 2011.

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17 600 Renaissance Center, Suite 1760 Detroit, MI BusinessLeadersforMichigan.com