unemployment

Two Democratic state lawmakers are preparing legislation that would restore unemployment benefits cuts recently signed into law by Governor Rick Snyder.  Snyder signed legislation to extend federal jobless benefits, but the bill also contained a provision shrinking state unemployment benefits from 26 to 20 weeks next year.  

Republicans lawmakers pushed for the jobless benefits cuts, saying it will reduce the burden on Michigan businesses, which pay into the state unemployment insurance pool. Jim Ananich is a state representative from Flint.   He’s introducing legislation to restore those benefits.  

“You know I’m hopeful that they will see the error of their ways and see that now is not a time to be taking money out of people’s pockets.”

Ananich hopes to introduce his bill next month.

Two days ago a friend of mine called me in a semi-panic. Her unemployment benefits were about to run out, and she had eighty-seven dollars to her name. She wasn’t going to be able to make the modest payment on her small house, and didn’t know what to do. Nor did she understand what was going on in the legislature. Someone had told her that the governor was signing a bill to extend unemployment benefits. Somebody else told her he was going to shorten them. Which, she wanted to know, was it?

Well, both, I said. The governor signed a bill Monday that extends eligibility for federal extended unemployment benefits for up to ninety-nine weeks.

That’s only, however, for people like my friend Karen, who already is collecting unemployment.

Next year, however, things will change drastically. Any Michigander who loses his or her job after January 15, 2012 will only be eligible for state unemployment benefits for a maximum of twenty weeks. That’s less than five months.

For years, jobless workers in Michigan have been able to collect benefits for a maximum of twenty-six weeks, or six months. They can collect them for longer periods of time now because the federal government decided to temporarily provide benefits, because of the lingering effects of the recession. Those effects are still hanging on in Michigan, where unemployment is still more than ten percent. Economists expect that to come down a little by next year, but we’re likely to continue to be a long way from full employment. What that means is that for many people, twenty weeks is not going to be enough time to find a job.

So why is our government making it tough for jobless workers? Interestingly, nobody is really coming forward to defend this. Governor Snyder said he signed this bill because it was necessary to extend benefits for those who are jobless now. He said he would have been happy to leave eligibility at twenty-six weeks, and blamed the legislature for shortening the time period. Why did they do this? Well, nobody is rushing forward to claim credit.

Khalilshah / Flickr

On Monday, Governor Snyder signed into law a bill that would extend unemployment benefits by 20 weeks to some 35,000 Michiganders. However, the bill also cuts six-weeks of state unemployment benefits for new filers beginning next year. The measure reduces jobless benefits in the state from 26 weeks to 20 weeks as of 2012. That reduction means, beginning next year, Michigan will provide the shortest number of weeks of unemployment out of any state in the nation.

Snyder’s signing of the bill has gained the state quite a bit of national attention.

From The New York Times:

Democrats and advocates for the unemployed expressed outrage that such a hard-hit state will become the most miserly when it comes to how long it pays benefits to those who have lost their jobs. All states currently pay 26 weeks of unemployment benefits, before extended benefits paid by the federal government kick in. Michigan’s new law means that starting next year, when the federal benefits are now set to end, the state will stop paying benefits to the jobless after just 20 weeks. The shape of future extensions is unclear.

The measure, passed by a Republican-led Legislature, took advocates for the unemployed by surprise: the language cutting benefits next year was slipped quietly into a bill that was originally sold as way to preserve unemployment benefits this year.

From NPR’s political blog:

Few states were hit harder by the Great Recession and unemployment than Michigan, a state that faced profound economic challenges, including relatively high unemployment, even before the national downtown.

So it could strike some as ironic that Michigan, of all places, just enacted into law a reduction of the number of weeks it will pay unemployment insurance to 20 weeks from 26 weeks starting next year.

The reduction will make Michigan the state that provides jobless benefits for the shortest number of weeks. And that's in a state whose jobless rate was 11.3 percent in February compared with the 9.5 percent national rate….

Gov. Rick Snyder, a Republican who took office this year, and GOP legislators said the reduction was necessary because the state's unemployment insurance fund is $4 billion in the hole as a result of its economic woes. Michigan borrowed from the federal government to keep the program afloat.

Since employers contribute to the state's jobless fund and were facing higher taxes to repay the federal loan, they supported the benefits reduction.

And, in a story picked up by USA Today, Chris Christoff with the Detroit Free Press, takes a hard look at the fact that Michigan owes, "the federal government about $3.96 billion that the state borrowed to pay unemployment benefits during the worst economy since the Great Depression. That's on top of the regular unemployment tax businesses and other employers must pay."

Snyder's signing of the bill also led some to speculate on whether or not other states would follow Michigan's lead in shortening benefits. An article in Examiner.com asks,"Will Ohio follow Michigan lead on reducing unemployment benefits?" And, in an article last week, the Washington Post noted:

This month, the Florida House approved a measure reducing the maximum benefit period from 26 to as little as 12 weeks while curbing increases in unemployment taxes paid by employers. The jobless rate in Florida is 11.9 percent.

“We are sending a message to the business community that Florida is quickly becoming the most business-friendly state in the country,” said state Rep. Doug Holder (R-Sarasota), the sponsor of the Florida bill.

It would go into effect Aug. 1.

In Arkansas, lawmakers are moving toward freezing unemployment benefits levels while trimming the maximum benefit period for state benefits from 26 to 25 weeks.

(Courtesy of the Michigan governor's office)

Update 11:33 a.m.:

Michigan Congressman John Dingell (D) has released a statement condemning Snyder's signing of the new law. In a written statement, Representative Dingell said:

"This law is another in a long string of Republican assaults on working families and unions. In one fell swoop, the Republicans in Lansing have made it so that people in Michigan receive state employment benefits for a shorter period of time than anywhere else in the nation. Michigan does face a budget crisis, but it cannot be solved by declaring war on the unemployed, who - now more than ever - need all the help they can get in order to support their families and find new jobs."

Original Post 10:52 a.m.:

Governor Rick Snyder today signed legislation extending jobless benefits. The law will allow 35,000 Michiganders to receive an addition 20 weeks of federal jobless benefits. Their benefits would have expired April 1st. In a written statement, Snyder says: 

"These benefits are a lifeline for many Michigan families who are struggling in this challenging economy... Cutting them off so abruptly would have jeopardized the well-being of those who are trying hard to find work. Now that we have continued this safety net, we must renew our focus on improving Michigan's economic climate. We will continue driving forward with our job-creating reforms so that fewer people need to rely on unemployment benefits."

Democrats pushed for the extension, but many eventually opposed the final version. The final legislation was amended to reduce the number state jobless benefits from 26 to 20 weeks.

Republicans say reducing the length of state benefits will reduce the burden on state businesses that pay into the state jobless benefits pool. By cutting the number weeks of state jobless benefits,  future unemployed Michiganders will be eligible for fewer weeks of additional federal unemployment benefits.  

According to the state Department of Energy, Labor and Economic Growth, the average unemployed Michigander uses about 19 weeks of jobless benefits. Michigan's unemployment rate declined to 10.4% in February. There were slightly less than a half million people in Michigan without a job who wanted one.  

Michigan's jobless rate is still about 2 percentage points higher than the national average. But the state's jobless rate has been declining since September 2009.

(Flickr swanksalot)

UPDATE 1:24 p.m.:   A spokeswoman for Governor Rick Snyder says the governor expects to sign the bill which would reduce the number of weeks jobless Michiganders will be able to recieve state unemployment benefits. Spokeswoman Sara Wurfel says:

"(The governor's) priority was to ensure no one receiving unemployment benefits was cut off abruptly. It's a lifeline for Michiganders right now - we simply can't risk tens of thousands of Michigan's families immediately losing their benefits in April.  He’s continuing to work tirelessly to help turn around Michigan's economy and create more and better jobs so that we can hopefully reduce the need for unemployment in the first place."

ORIGINAL POST 12:17 p.m.: Democrats are calling on Governor Rick Snyder not to sign legislation that will reduce state unemployment benefits to Michiganders from 26 to 20 weeks. The Republican controlled legislature passed the benefits  cut Wednesday, as part of  a bill to continue extended federal jobless benefits to Michigan’s unemployed.

Royal Oak Congressman Sander Levin says the governor should veto the bill that will eventually reduce benefits for Michigan’s most in need.  

"This is the worst time to do this for Michigan workers.  I think it is reckless.  It’s inexcusable.”

Cutting state benefits will reduce the cost to Michigan businesses that must pay into the unemployment fund.  Cutting state unemployment benefits by 6 weeks could also reduce federal unemployment benefits by up to 16 weeks for jobless Michiganders. The Michigan Chamber of Commerce says the change will save state businesses $300 a year starting in 2012.

Levin says it’s unfair to shorten the period unemployed Michiganders can receive jobless benefits. 

“The governor can say to the legislature 'Get back.  Do what needs to be done here.  And stop the hijacking.'”

Federal jobless benefits for 35,000 unemployed Michiganders will expire April 1st  if Snyder vetoes the bill.

People who file for unemployment benefits next year would be eligible for fewer weeks of payments under a Republican measure approved by the state Senate. The Legislature must approve a jobless benefits package this week in order for the state to receive federal assistance for the program.

Thirty-five thousand Michiganders stand to lose their benefits if the legislature does not agree to the extension by April 1st. 

Democratic state Senator Tupac Hunter says Republicans are using the opportunity to undercut benefits for people who seek the payments in the future.

“This is 100 percent federally funded, we have an opportunity to address that today, and I think that we’ve chosen political games over helping our workers across this great state.”  

Republican state Senator Tom Casperson says the additional benefits would put too much strain on businesses. 

“Putting people into jobs is the way to fix the problem. But we don’t get there when every time we open our mouths we demonize the very job providers that are going to provide the jobs for us. This is trying to offer an opportunity for both sides; a safety net and add to the unemployment, and a fairness to the business people paying the bill.”

The bill was passed and now moves to the state House for final approval.

(Flickr ziggy fresh)

Michigan’s unemployment rate dropped slightly in February. Michigan’s seasonally adjusted unemployment rate declined by 3 tenths of one percent last month to 10.4%.

The state’s jobless number was still one and a half percentage points above the national unemployment rate of 8.9%.  

Michigan’s unemployment rate has been falling since September 2009. And last month, the number of jobless Michiganders fell below a half million for the first time since November 2008.

Daniel Johnson / creative commons

A legislative watchdog says Michigan’s unemployment office failed to catch overpayments and cases of fraud as the agency was hammered with jobless claims during the Great Recession.

The Michigan Auditor General says the mistakes cost taxpayers an estimated $260 million.

Like many states, Michigan’s been forced to borrow money from the federal government – almost $4 billion - to cover its jobless claims as unemployment reached peaks not seen in three decades (higher than 14%).

The Auditor General report found the agency ran into trouble handling all those claims.

The auditor’s sample found thousands of cases where the state accidentally overpaid benefits that were never recovered.

The audit also found instances where the state failed to detect cases of fraud that would have also been punished with big fines.

The unemployment agency is disputing some of the findings where the auditor determined there was fraud. The agency says in the other cases, it’s taking steps to fix the problems uncovered by the Auditor General.

(Flickr Steve Rhodes)

The unemployment benefits of 35 thousand jobless Michiganders are about to expire.  There is some debate whether the state should act to extend their benefits by another 20 weeks.    The debate is between those who say the benefits are critical to jobless workers and business groups that say they don’t want to be forced to pay for those benefits.  The clock is ticking.  

In case you missed it...

Mar 11, 2011
user cpstorm / Flickr

Michigan Radio broadcasts hundreds of stories, interviews, and commentaries every week.

One person can't possibly hear them all.

Here, you'll find a few stories we think you might like to hear:

Oh You Shouldn't Have... no really - This American Life

Khalilshah / Flickr

Michigan's unemployment rate continued in decline in January to 10.7 percent. That's the lowest it's been in more than two years. And, it's three percentage points lower than the same time last year: the jobless rate in January 2010 was 13.7 percent.

The national jobless rate in January of this year was 9.0 percent.

Mr. Juniho / flikr

Budget cuts approved by the U.S. House of Representatives would close Michigan Works service centers.

The service centers are where people go to file for unemployment and can get training, education or use the Michigan Talent Bank.

The U.S. House budget proposal eliminates the federal funding that supports the centers.

Luanne Dunsford is the CEO of Michigan Works.

"If the house resolution goes through the funding for Michigan Works would be eliminated. The Michigan Works system serves over 3 million customers a year and our question is, where would those people go?

The U.S. House and the Senate are now negotiating budget proposals to decide the fate of several federal programs, including the Workforce Reinvestment Act which funds Michigan Works.

We want to get a better understanding of the kinds of services offered by Michigan Works. If you've used Michigan Works, what services did you use and what did you think of them?

Sarah Alvarez - Michigan Radio Newsroom

Steve Carmody / Michigan Radio

From General Motors adding another shift at the Flint Assembly plant to expansion in the city's medical and echnology centers, Flint's job picture is brightening.

Flint city leaders say their community posted one of the ten biggest drops in unemployment in the U.S. over the last 12 months.

Between December 2009 and December 2010, Flint's jobless rate fell from 16 percent to just under 12 percent.

Flint Mayor Dayne Walling says the city helped create or keep mare than a thousand jobs by encouraging entrepreneurial businesses.

For everybody who's left, there's a project out there that kept a job here too. That?s the other part of the story. It may not be a new job. It's not someone who's newly employed. But there are another 500 or 1000 people who would have left here if these projects wouldn't have been successful.

This all builds on what our president said in his State of the Union, that we need to create jobs and industries of the future by doing what America does best.  Investing in the creativity and innovation of our people.

Walling concedes people leaving Flint also helped improve the city's unemployment rate.

Flint's unemployment rate is still above state and national levels.

The unemployment rate fell .4 percentage points in January to 9.0%.

Keith Hall, the Commissioner of the Bureau of Labor Statistics said today:

In January, employment increased in manufacturing and retail trade, while job losses occurred in transportation and warehousing and in construction.  Employment in most other major industries changed little. Manufacturing employment grew by 49,000 over the month and has increased by 161,000 since a recent low point in December 2009.

The Associated Press reports:

The unemployment rate has fallen by eight-tenths of a percentage point in the past two months. That's the steepest two-month drop in nearly 53 years. But part of that drop has occurred as many of those out of work gave up on their job searches. When unemployed people stop looking for jobs, the government no longer counts them as unemployed.

Officially, there are about 13.9 million people in the country out of work. The AP says "that's still about double the total who were out of work before the recession began in December 2007."

The unemployment rate in Michigan stands at 11.7% as of December. New numbers should be out in the coming week.

Khalilshah / Flickr

Michigan's unemployment rate dropped in December to 11.7 percent. But, as Rick Pluta reports, the decline in the jobless rate was due mostly to people who have stopped looking for jobs:

Michigan’s unemployment rate dropped steadily throughout 2010. But there are still 555,000 people in Michigan who are out of work and looking for jobs. Half of them have been looking for six months or more.

There was little new hiring last month. The number of people who simply stopped looking for work is the biggest reason for the decline in the jobless rate. The state Department of Energy, Labor, and Economic Growth says the number of people who say they are available to work fell by 37,000.

When people who are looking for jobs, those who’ve quit looking, and part-time workers who’d like to be full-time are rolled together, Michigan’s rate of unemployment and under-employment is 21 percent.

Michigan’s unemployment rate in 2010 was 13.6 percent. That’s a drop of half a percentage point from the 2009 average.

A former student sent me an e-mail a couple days ago that made me both happy for her and concerned about our state. She had been a “ninety-niner,” Beth confided, and her prospects looked bleak.

She worried about having to move back in with mom and dad. But then, on Christmas Eve, she got a job. “Not a glamorous job, but a necessary one,” she said.

That made me happy for Beth, but also reminded me that there are at least 162,000 other ninety-niners in this state who aren’t as lucky. Ninety-niners, by the way, are people who have exhausted their unemployment benefits.

The U.S. House of Representatives voted to extend Bush-era tax breaks and extend jobless benefits for the long-term unemployed yesterday.  The tax-deal was brokered between President Obama and leaders in the House and Senate.  The President is expected to sign the bill soon.  As The Associated Press reports:

In a remarkable show of bipartisanship, the House gave final approval to the measure just before midnight Thursday, overcoming an attempt by rebellious Democrats who wanted to impose a higher estate tax than the one Obama agreed to. The vote was 277-148.

Republican Congressman Dave Camp of Michigan told USA Today:

Congress made the right decision ... to prevent a job-killing tax hike on Americans and small businesses.

The U.S. Senate had already passed the bill with a 81-19 vote.

George Erickcek is Senior Regional Analyst at Upjohn Institute
Lindsey Smith / Michigan Radio

Researchers at the Kalamazoo-based Upjohn Institute predict Michigan’s economy is stabilizing, but caution it will be a long road to a full recovery.

“We have to realize that what Michigan is coming out of is not a transformed economy, although all of us would like to think that’s true. We’re coming out a leaner economy, a little bit meaner and little bit more advanced but in fact just kind of a smaller version of what we were before, in my opinion.”

Senior Regional Analyst George Erickcek says full recovery will depend on the state’ ability to meet the demand for trained workers in growing industries. In a presentation to leaders in Grand Rapids Wednesday, Erickcek said 25 to 34 year-olds are not achieving the same education levels as the generation before them. That’s the case in Michigan and the nation.

Governor Jennifer Granholm
Photo courtesy of www.michigan.gov

Governor Granholm says she supports President Obama’s compromise with Congressional Republicans on tax cuts.

Granholm said that the President got a ‘good deal’ by extending benefits for the long-term unemployed in exchange for the extension of Bush-era tax cuts.

Granholm said the deal will keep 180,000 people in Michigan from losing their income during the holidays:

I look at this as governor of the state with the second highest unemployment rate in the nation and I'm grateful to the President for being a pragmatic leader... the collateral damage here in Michigan from not extending the unemployment benefits would be horrific.

Granholm made the comments during a White House conference call yesterday afternoon.

Unemployment benefits deal reached

President Obama says he has reached a deal with Republican lawmakers to extend unemployment benefits. 180,000 Michiganders were going to see their benefits expire by April if a deal was not reached. In exchange for the benefit extensions, Obama agreed to extend the Bush-era tax cuts at all income levels, including the wealthy. The New York Times reports that Obama said the deal is "not perfect, but this compromise is an essential step on the road to recovery." But a battle may still remain, congressional democrats say they have not agreed to any deal yet.

City bans medical marijuana

A fourth city has banned medical marijuana. Wyoming, a suburb of Grand Rapids, passed the ban last night in a unanimous city council vote. Michigan Radio's Lindsey Smith reports that Wyoming Mayor Jack Poll says the ban is not a rebuke of medical marijuana rather "this is a vote against the way it is being dispensed."  Medical marijuana dispensaries have been popping up in different parts of the state after voters approved the medical marijuana law in 2008. The dispensaries are often in nondescript storefronts. The Detroit Free Press reports that Mayor Poll, a pharmacist himself, says medical marijuana should be dispensed like other legal drugs, presumably at mainstream pharmacies.

State to honor Pearl Harbor Day

Governor Granholm is asking Michigan residents to lower flags to half staff today to honor Pearl Harbor Day.  Sixty-nine years ago this morning, Japan attacked U.S. Forces stationed at Pearl Harbor, Hawaii. 2,334 servicemen and servicewomen were killed. 1,143 were wounded. Granholm says the action also honors current  service men and women:

"We also salute the brave men and women currently stationed around the world, including those fighting in Iraq and Afghanistan, who are defending and protecting the freedom our nation holds so dear." 

One economist says the end of jobless benefits for thousands of Michiganders should not have a big effect on the number of jobs being filled.

 More than 180 thousand people in Michigan will see their unemployment benefits expire between now and April, unless Congress agrees to grant another extension. 

Kenneth Goldstein is with the Conference Board, a business research group.   He says there are few real new job options,  either full or part time for the ‘hard-core’ unemployed.

The White House is ramping up its efforts to get Congress to approve extended unemployment benefits for out-of-work Americans. Michigan's unemployment rate in October was the second-highest in the nation, at 12.8%.

The president's Council of Economic Advisers released a report that touts the need for extending benefits. The report says for the typical person getting unemployment, the benefits make up a third of the household income.  As Presidential adviser Cecilia Rouse noted:

And in those 42% of households where the unemployed person was the sole wage earner, it's about 90 percent of the income. So it's quite an important source of income for these families.

The report says about 620,000 people in Michigan received benefits through October.

Republicans in Congress say the cost of extending the benefits is too high. They want to look at budget cuts and tax cut extensions first.

Jobless benefits will expire for tens of thousands of unemployed Michiganders this week unless Congress approves an extension.



Many of those losing their benefits are expected to turn to Michigan food banks and other non-profit groups.



"Those safety nets are really not prepared to take on all of these extra families," says Judy Putnam, with the Michigan League for Human Services."


Michigan congressman Dale Kildee expects congress will approve extending jobless benefits for the long-term unemployed next week. 


An extension would allow people who’ve been receiving jobless benefits for more than 26 weeks to continue to receive financial aid.   The current extension expires next Wednesday.    Hundreds of thousands of unemployed Michiganders will stop receiving unemployment checks unless an extension is approved. 

Unemployment line in California
Michael Raphael / Flickr

The Associated Press reports that the state "will stop taking new extended unemployment benefit applications after Saturday because Congress has failed to renew the program."

Jobless
Photo by Khalilshah/Flick

Michigan's jobless rate continued its slow, but steady, decline in October.  The state's unemployment rate in October was 12.8%.  It's the first time the jobless rate was been under 13% since March 2009, according to the Associated Press. The state's jobless rate in October of 2009 was 14.4%.

The national unemployment rate for October was 9.6%.

 Time is running out again for many Michiganders living on unemployment benefits.

 Hundreds of thousands of Michiganders have spent nearly two years surviving on unemployment checks as the state struggles with a double digit jobless rate.

But time may be running out for those benefits.  Congress has passed several extensions but may not this time. 

Norm Isotello is with the state department of Energy, Labor and Economic Growth.    He concedes there is an argument that extended benefits may get in the way of people looking for work...but

help wanted sign
kandyjaxx/creative commons

The unemployment picture in Michigan is still bad. It stands at 13.1% now. The worst it's been since the early 1980's.

Now, a new report by the Michigan League for Human Services puts the long-term unemployment picture into perspective.  In 2000, people unemployed for more than 26 weeks, accounted for 6.5% of the total number of unemployed. Today, the long-term unemployed account for 40.8% of the unemployed.

The report says,

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