KENT COUNTY, Mich. — SpartanNash's $1.7 billion sale and W.K. Kellogg's merger with an Italian company highlights a trend of consolidation as companies navigate the current economy.
"Things like tariffs are much easier to navigate when you're really big," Paul Isely, Professor of Economics at Seidman College of Business at Grand Valley State University, said.
In recent weeks, Byron Center's SpartanNash announced it would be sold to a national grocer for $1.7 billion, while W.K. Kellogg is in the process of a merger.
"SpartanNash was a combination to get bigger and get better buying power, and that's what they need to be able to compete," Isely said.
The economics professor noted that W.K. Kellogg's merger follows a similar strategy.
"They've merged. That also allows them to get bigger, and it helps them navigate the supply chain issues that are happening in the world today as these tariffs come on and off," Isely said.
FOX 17 spoke with Isely about what's driving these corporate consolidations. He believes uncertainty in the market is a key factor.
"It's made it very hard for businesses to plan, and so in many cases, they've chosen to pull back a little bit to wait and see what happens," Isely said.
The economic challenges are reflected in Michigan's employment figures. The state's seasonally adjusted unemployment rate stands at 5.4%, above the national average of 4.1%.
"I think the job market is very fragile right now. If you have the right skill sets, you're doing okay," Isely said.
According to Isely, Michigan's automotive industry remains the sector most vulnerable to current economic conditions. Especially as automakers navigate the changing landscape of manufacturing gas-powered versus electric vehicles.
"That level of uncertainty for the automotive industry is what's hurting Michigan more than anything else," Isely said.
Despite these challenges, Isely remains optimistic about West Michigan's economic resilience.
"We're starting to see a little bit of a tick up right now in the manufacturing sector," Isely said.
He attributes this positive movement to companies working to rebuild their supply chains.
"It looks like trying to backfill inventory that was purchased automotive-wise, as people rushed to buy cars before the tariffs came in, so now they have to rebuild some of that inventory," Isely said.
Isely noted that consumers might begin seeing more impacts in the coming months, particularly in the form of price changes on consumer goods.
This story was reported on-air by a journalist and has been converted to this platform with the assistance of AI. Our editorial team verifies all reporting on all platforms for fairness and accuracy.
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