Detroit in many ways screwed itself. First, it put too many eggs in one basket – the auto industry. Second, it never invested in public transit infrastructure due in part due to pressure from the auto industry. Thus, when the manufacturing jobs evaporated, service companies found it hard to set-up shop in downtown Detroit due to lack of transit options into the city core. Chicago, which is also a major manufacturing city, diversified its economy and invested in public transit. Its population between 2000 and 2010 dropped 7% while during the same time period, Detroit’s dropped 25%.
The auto industry in the US was its own worst enemy, too, in the early 2000’s. The Big 3 refused to see that consumer taste was changing, i.e. let’s sell hemi engines in everything when gas post-Katrina was over $4 a gallon. The auto unions also contributed as their greed blinded them to the fact that the industry cannot afford workers with a high school education (good people, just not the skill set needed in today’s economy) making $40/hour on the factory floor while folks doing the same job in Tennessee and abroad are making $20/hour or less. Plus, for every job lost at one of the Big 3, something like 5 jobs are lost at the Tier I and II suppliers that are all over the place in metro Detroit.
