Gross State Product (GSP), the market value of all goods and services
produced in a state, is the broadest measure of a state's economic activity.
Chart 3 summarizes average annual
real GSP growth rates between RTW states, non-RTW states and Michigan from
Right-to-work states enjoyed a 0.5 percent annual growth advantage over non-RTW
states. This is a considerable growth advantage, particularly when compounded
over 23 years.
Dividing the results into two equal time periods (1977-88 and 1988-99, both of
which include a recession) to discover any changes in relative growth rates
yielded even more distinctions (see Table
I, Appendix I). While the average annual growth advantage held by RTW states
was just 0.1 percent from 1977-88, it accelerated to 1 percent from 1988-99.
Michigan averaged 1.8 percent growth from 1977-99, growing a little more than
half as fast as the average RTW state. Michigan's growth even lagged that of its
sister non-RTW states by more than 1 percent annually. Over this period, only
three states have grown more slowly than Michigan (Montana at 1.6 percent, West
Virginia at 1.3 percent, and Louisiana at 1.4 percent).
While Michigan's annual GSP growth more than doubled during the 1988-99 period,
it still lagged behind the GSP growth of the average RTW and non-RTW states by
significant margins (Michigan's state ranking increased to 36th). While
Michigan's growth did accelerate during this period, that growth was slower than
the average growth in RTW and non-RTW states. Only two RTW states (Wyoming and
Louisiana) failed to grow as fast.