FDI in DETROIT

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IN Detroit, MI

WHAT IS FDI?

1991

2011

These profiles analyze how the characteristics of foreign-owned establishments (FOEs) and the jobs within them vary across U.S. states and metro areas.

SHARE OF JOBS IN FOEs

DETROIT

0% 1991

By jobs in FOEs & establishments in 2011

2001

TOP FIVE INDUSTRIES

By jobs in FOEs (pct of total FOE jobs) in 2011

62

MOTOR VEHICLE PARTS 34,200 (27.5%)

MOTOR VEHICLE WHOLESALERS 8,200 (6.6%)

MOTOR VEHICLES 8,100 (6.5%)

MANUFACTURING PROFESSIONAL & TECH BUSINESS SUPPORT

WHOLESALE RETAIL REST

15,900

FDI also facilitates the spread of new knowledge, technologies, and ideas--flows critical to innovation and competitiveness in the global economy. But the magnitude and nature of FDI differ from place to place.

US

1%

596

Corporate R&D Goods Exports

2%

7,300 4,600

20.3%

Capital Investment

ESTABLISHMENTS

18.9%

Productivity Growth

JOBS IN FOEs

15.2%

3%

DISTRIBUTION OF ESTABLISHMENTS & JOBS ACROSS SECTORS

INDUSTRY

12.0%

6%

RANK: 5

9,100

Compensation

7%

4%

327

6.7%

8%

5%

12,600

Value Added

Share has increased and ranks above the U.S.

9%

RANK: 4

199

6.3%

7.8% 7.5%

386

Employment

RANK: 10

RANK: 6

75,000

5.0%

124,420 123,000

SHARE OF TOTAL PRIVATE EMPLOYMENT IN FOEs

SHARE OF TOTAL PRIVATE EMPLOYMENT IN FOEs

2011

FDI matters because the U.S. operations of foreign firms contribute inordinately to the economy. While acounting for only 5 percent of private sector employment, FDI accounts for:

1991

WHY DOES FDI MATTER?

JOBS IN FOREIGN-OWNED ESTABLISHMENTS (FOEs)

OVERALL TREND

FDI occurs when a foreign company invests in a U.S. business enterprise either by opening a new operation or through a merger or acquisition. The foreign company must hold a majority stake in the U.S. operation for it to be considered "foreignowned."

A JOINT PROJECT OF BROOKINGS AND JPMORGAN CHASE

450

FDI

ENGINE & POWER EQUIPMENT 7,700 (6.2%)

AUTOMOBILE DEALERS 5,700 (4.6%)

NUMBER OF JOBS IN FOEs OPENING

2011

SHARE OF JOBS IN FOEs BY MODE OF ENTRY

NUMBER OF JOBS IN FOEs OPENING AFTER OR ACQUIRED SINCE 1991

FOEs that entered foreign ownership via M&A after 1991 accounted for the largest share of jobs in 2011

80

DETROIT

By 2011 M&A accounted for 63,300 jobs in FOEs while openings accounted for 25,900 OPENINGS M&A

51%

60

US

21% 32%

42%

THOUSANDS

MODE OF ENTRY

70

28%

TERMINOLOGY FDI: Foreign-direct investment Foreign-Owned Establishments (FOEs): Single places of business belonging to a foreign-parent company; e.g. a factory, warehouse, store, or office Openings: New physical place of business, includes new construction (greenfield) and new occupancy of existing space M&As: Mergers and acquisitions City-Region: Subnational administrative division such as a state, province, or prefecture, titled by its largest metro

50 40

NOTES 30 20

26%

10 M&A SINCE 1991

OPENINGS SINCE 1991

PRE-1991

1991

TOP FIVE SOURCE CITY-REGIONS

By jobs in FOEs (pct of total FOE jobs) in 2011

GLOBAL SOURCE

TURIN, ITALY 39,900 (32.1%)

2001

TOP FIVE SOURCE COUNTRIES

By jobs in FOEs (pct of total FOE jobs) in 2011 ITALY 41,100 (33.1%)

2011

● Metro profiles rank the largest 100 metropolitan areas by population ● State profiles rank across all states plus the District of Columbia ● All changes in reported jobs in foreignowned establishments include both net jobs created or lost plus transfers of existing jobs from US to foreign-ownership through M&As, thus it is possible for the number of jobs under foreign-ownership to increase without net job creation taking place ● The mode of entry of all establishments that arrived prior to 1991 is unknown, which is the first year in the database ● Methodological details of this database are described in an accompanying appendix available on the report website ● Data source: Brookings analysis of the National Establishment Time Series, Bureau of Economic Analysis Financial & Operating statistics, Dun & Bradstreet, and Moody's Analytics data

STUTTGART, GERMANY 10,300 (8.3%)

GERMANY 21,500 (17.3%)

TOKYO, JAPAN 8,700 (7%)

JAPAN 12,300 (9.8%)

TORONTO, CANADA 6,700 (5.4%)

CANADA 8,500 (6.8%)

MORE INFORMATION REPORT: “FDI in U.S. Metro Areas: The Geography of Jobs in Foreign-Owned Establishments”

PARIS, FRANCE 5,700 (4.6%)

ENGLAND 7,700 (6.2%)

WEB: BROOKINGS.EDU/METROFDI TWITTER: #METROFDI