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Michigan Retailers Association Reports Item Pricing Reforms Keeping Grocery Prices Down

LANSING, MI--(Marketwire - Oct 2, 2012) - Reform of Michigan's item pricing law in 2011 is keeping Michigan grocery prices down and providing savings to consumers, exactly what the governor and lawmakers said it would. The years-long decline of grocery store jobs also has reversed since the item pricing reforms took effect.

James P. Hallan, president and CEO of Michigan Retailers Association, said those conclusions come from recent government data and refute claims made by the Michigan Citizens Action organization (which prevented Michigan Retailers Association representatives from attending the group's news conference).

Hallan and Scott Watkins, director of market and industry analysis at Anderson Economic Group in East Lansing, said:

  • Grocery store prices from the first half of 2011 to the first half of 2012 have increased far less in Michigan (2.5 percent) than at the national level (3.7 percent). (Source: U.S. Bureau of Labor Statistics, Consumer Price Inflation, Food at Home category.)

  • Grocery story employment is currently at 60,700, up from the 2011 figure of 60,600. This is the first increase in grocery store employment in Michigan since at least 2002. (Source: Michigan Department of Technology, Management and Budget.)

  • Total wages paid by Michigan food and beverage establishments, including grocery stores, show a significant increase from first quarter 2011 to first quarter 2012 ($361.4 million to $390.5 million). (Source:U.S. Quarterly Census of Employment and Wages.)

Donald Grimes, senior research associate, Institute for Research on Labor, Employment and the Economy, University of Michigan, also said his research found prices have not risen as fast in Michigan since the reform law went into effect and grocery story employment has increased.

Anderson Economic Group prepared the 2011 white paper that identified the hundreds of millions of dollars in annual, unnecessary costs to retailers and consumers that resulted from the state's outdated and costly item pricing law. Reforming the law, the research study said, would enable retailers to pass savings onto consumers in different ways, including improving customer service, adding more jobs and keeping prices from rising as fast as they would have under item pricing.

Note: Scott Watkins can be reached at 517.333.6984; Donald Grimes can be reached at 941.876.6422.

Michigan Retailers Association represents nearly 5,000 businesses and their more than 15,000 stores and websites in Michigan. Retail is responsible for nearly one in five jobs in Michigan's economy: 405,000 direct jobs in retail stores and more than 385,000 jobs in related and supporting industries.