The news is finally out. Everyone in Michigan’s Great Lakes Bay Region has been on pins and needles regarding the Dow/Dupont/Dow Corning mergers, and today we received confirmation that 700 jobs will be eliminated in the Great Lakes Bay Region. I’m sure no one is surprised, but everyone is likely nervous, at best. Let’s break down what this announcement may mean for Midland’s real estate market.
First, we need to remember that Dow Chemical is not leaving Midland, Michigan. According to Howard Ungerleider, Dow’s CFO, Dow remains committed to the Great Lakes Bay Region. Construction is continuing on the new corporate headquarters, with Dow’s reported intent to maintain headquarters for the new material sciences business here.
Second, we have been through this before. October, 2008 Dow Chemical released over 600 employees in the Great Lakes Bay area. We are still here. Sure, there was an impact, but in the long run, the effects have stabilized and the economy and real estate market have improved.
Third, impacts are not expected to be immediate. Ungerleider indicated everyone will know the status of their job by September, but that does not mean all jobs will end in September. Many will stay on for weeks, months, or as long as two years through the transition. Dow is ending jobs in measured phases, which allows the real estate market and economy to absorb the changes slowly.
Fourth, not all 700 jobs are layoffs. It’s typical during workforce reductions to have a percentage of cuts made via retirements. In those cases, most retirees do not leave the area. Additionally, we typically see an emergence of creative genius entering the work force as entrepreneurs and small business owners. How exciting! Those new entrepreneurs will not likely be selling their homes, thus not inundating the market unnecessarily.
Lastly, Midland has been reassured by Ungerleider that many resources will be at hand to help displaced workers get back into the local workforce. Some will re-employ in the area, some will start their own businesses, and some will leave. But it is important to know that Dow and other employers will still be bringing people in. MidMichigan Medical Center, Midland’s second highest employer, has professionals coming in and plans to bring more in over the next three years. They are expanding, bringing personnel into Mt. Pleasant as well as Midland. DowDupont will also be allocating new employees to the Great Lakes Bay Region, as we have already seen transferees coming in to our town.
The bottom line is, the number sounds big, but it is likely that the overall impact on the real estate market will not be devastating or sustained. Major area employers have made cuts in the past and history shows that the real estate market has rebounded each time.
If you or your family or friends are in the market to buy or sell in the Midland area, simply listen to the advice of your REALTOR. We are watching the market very closely and know what the trends are specific to your area and price range.