According to the latest Business Formation Statistics report, Michigan saw a decrease in business applications last month compared to the same point in 2021, though a closer inspection over the past five years of data suggests business applications are substantially higher in Michigan compared to the years before the pandemic.
This follows a broader trend within the state and region that’s been seeing business application numbers drop in comparison to last year, but remain significantly higher than pre-pandemic numbers.
In March of 2022, Michigan saw a decrease of 1,553 business applications compared with March of last year, dropping from 12,378 to 10,825 applications. But a comparison with March of 2019, the last year before the pandemic, highlights a dramatic increase from the 6,692 applications submitted that year.
The data suggests that though business applications peaked in 2021, likely due to a combination of holdover applications from 2020 and federal aid programs, 2022 is on track to have more business applications submitted in the state than any point in the past ten years, excluding 2021.
Nearby states in the Midwest region with comparable economies also saw a similar trend in March, with business applications dropping compared to the same point last year, even as they remain significantly higher than any recent point before the pandemic. Illinois saw a drop from 17,160 to 14,146 applications compared to March of 2021, yet the 2022 numbers are still higher than 2019’s, which saw only 9,785 applications.
The Midwest region saw a decrease of 7,352 business applications during the month of March 2022 compared to the same point last year, falling from 75,307 to 67,955, though it remains higher than March of 2019, which saw 50,126 applications.
Meanwhile, the nation saw a total of 413,958 business applications last month, which is a 36,639 application drop from the 450,597 business applications filed in March of 2021, highlighting that the economy still remains stable and strong despite reports of stagnant wages and inflation rates reaching an all-time high.
Overall, Utilities, Administrative and Support, and Real Estate were some of the industries that saw an increase in business applications during the month of March, while Retail Trade and Mining experienced the biggest drops.