The Business Case for Racial Equity in Michigan

Report | May 29, 2015 | Ani Turner

Drawing research from a range of sources, including The Johns Hopkins University, the Altarum and consultants from Michigan State University, Brandeis University and Harvard University, this report estimates the potential economic benefits of seizing opportunities in actively promoting equity and addressing racial and ethnic inequities in Michigan.

Highlights include: 

  • If the average person of color achieved the average income of his or her white counterparts at any age, total Michigan earnings would increase by 7.5 percent or $16.2 billion (2012 projection). If the earnings gaps were eliminated, the increased earnings would raise the state's economic output by a comparable percentage for an increase of $31.2 billion in state GDP;
  • Addressing the gaps in health disparities between people of color and whites could save the state $2.03 billion in excess medical costs and $1.39 billion in lost productivity;
  • Increasing the male high school graduation rate in Michigan by only 5 percent would produce crime-related savings of more than $175 million; and
  • If 70 percent of children of color, from birth through age 3 in Michigan, who are estimated to be "at risk" achieved school readiness, the present value of lifetime savings would be $4.5 billion.

The report also outlines the current realities and legacy effects of racial and ethnic inequities across the state.

"Racial inequities are caused by the unequal distribution of resources and opportunities, and affect health, education, earnings and other life outcomes. This costs Michigan billions of dollars in lost economic potential," said Ani Turner, deputy director of the Center for Sustainable Health Spending at the Altarum. "One third of Michigan's younger generation are people of color, so tackling the obstacles that put children of color at a disadvantage is not only the right thing to do, it could be a significant driver of our collective social and economic well-being."

For additional technical notes, please click here.

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