UM-Dearborn's iLabs conducts its third annual survey of technology executives in southeast Michigan

June 3, 2010

DEARBORN / June 3, 2010---While technology executives in Michigan remain unchanged in their feelings that the state is not an ideal place to start or grow a business, their opinions are not simply a reaction to the economic conditions in the state, according to a survey conducted by the University of Michigan-Dearborn’s iLabs, Automation Alley and the Detroit Regional Chamber.    

The third annual Michigan Technology Climate Survey assessed opinions of technology executives in southeast Michigan regarding the current business climate facing Michigan’s technology firms.  This past spring, the survey queried 114 executives from Genesee, Macomb, Monroe, Oakland, St. Clair, Washtenaw and Wayne counties.

“More than half of the respondents, or 54 percent, say that Michigan is a below-average location for to start a technology company, consistent with the 2008 and 2009 results,” according to Timothy Davis, director of iLabs, also known as the Center for Innovative Research at UM-Dearborn.  

This year’s survey found that 54 percent of executives say the business climate for technology firms in Michigan is worse than the rest of the country.  “While this is an improvement over 2008 and 2009, the perception is still not positive,” Davis said. Consistent with the previous two years, only one in 10 executives feel the technology industry conditions are better in Michigan than other states.

While the general perception of Michigan’s technology climate is not positive, the majority of executives that were surveyed lead stable firms.  Fifty-one percent plan to increase their workforce in 2010, which is a significant increase from 2009 when only 31 percent planned to expand their workforce.

“This year, only 7 percent indicate they plan to reduce their workforce, a significant decrease from 29 percent in 2009,” Davis noted.  All the firms who expect to reduce their workforce cite a decrease in sales as a reason for layoffs.  Those who plan to maintain their workforce feel a lack of capital and market opportunities are hindering their growth along with uncertain economic conditions.  Executives who plan to expand their employee base will do so via an increase in sales and new products or services, according to the survey.

When looking at 2010 revenues, 65 percent of executives expect to see an increase over last year. “Although most executives expect their 2010 revenue to hold steady or increase, only 44 percent feel that their expectations regarding revenue changes are meeting their plans for growth,” Davis said.

Technology executives continue to feel that Michigan is ineffective when it comes to business development in the current economic situation.  "Three quarters of executives do not believe that the state's policies are supportive of entrepreneurs nor do they have confidence in how the state is promoting economic growth," Davis said.

Executives show interest in services or training if offered by the state or regional organizations. Networking events and opportunities to learn from other technology firms in the area, information on seed funding for R&D efforts and information on funding to commercialize products are of interest to more than half of executives surveyed.

Congruent with 2009 and 2008, four in five executives surveyed feel that reducing Michigan’s dependence on that industry would improve the state’s economy. “For the third consecutive year, executives agree that shifting the Michigan economy from one that is manufacturing-based to knowledge-based is necessary for the state’s long-term success," Davis said.

All of the executives surveyed work for technology firms that have centralized operations within southeastern Michigan.  Ninety-one percent identified their title as president, CEO, COO, vice president, partner, director or manager of the firm.

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About University of Michigan-Dearborn
Founded in 1959 with a gift of just over 200 acres of land and $6.5 million from the Ford Motor Company, UM-Dearborn has been distinguished by its commitment to providing excellent educational opportunities responsive to the needs of southeastern Michigan. The university has 8,700 students pursuing undergraduate, master’s, doctoral and professional degrees in the liberal arts and sciences, engineering, business, education, and public administration. With a faculty devoted to teaching, and students committed to achievement, UM-Dearborn has been shaped by its history of interaction with business, government and industry in southeastern Michigan, and is committed to responding to the needs of the region in the future.
 

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