Report: Michigan Unemployment Insurance System Worst in Midwest

According to a new report from the Michigan League for Public Policy, the state’s Unemployment Insurance system trails other Midwest states, excludes too many workers, and is not paying enough in benefits to keep families from falling below the poverty line.
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Signing up for unemployment insurance
The Michigan League for Public Policy has released a report detailing Michigan’s unemployment insurance as the worst in the Midwest. // Stock Photo

According to a new report from the Michigan League for Public Policy, the state’s Unemployment Insurance system trails other Midwest states, excludes too many workers, and is not paying enough in benefits to keep families from falling below the poverty line.

The study, titled “Falling Short: Michigan’s Unemployment Insurance Needs a Real Reform to Meet the Needs of the 21st Century Workforce,” showed compared to eight Midwest states, Michigan provides the fewest weeks of benefits (20), pays the lowest maximum weekly benefit as a numerical figure ($362 per week) and as a percentage of the average weekly wage (35 percent).

“Michigan is operating with unemployment insurance policies that do not meet the needs of workers, their families, or the state economy. Too many workers are ineligible for unemployment, and for those who are eligible, the benefits are too low,” says Gilda Z. Jacobs, president and CEO of the Michigan League for Public Policy (MLPP).

“If we’ve learned anything over the past year, it’s that we need to make sure our systems are on solid ground — and even before COVID-19 hit, Michigan’s unemployment insurance system was broken. Michiganders deserve better.”

Currently, more than 20 bills are in front of the Michigan legislature that address the problems outlined in the report, including boosting benefits for 26 weeks, increasing the allowance for dependents, covering more workers, and raising weekly benefits first to $593, then to 58 percent of the average weekly wage.

The MLPP says that due to systemic inequities, women and workers of color are more likely to work earn less and work part time, and therefore more likely to be impacted by the state’s prohibition against part-time workers receiving benefits.

The report also showed that Michigan has the highest wage eligibility requirements coupled with the lowest rate of coverage among unemployed workers at 72 percent.

“The system was really designed to support a workforce that doesn’t exist anymore. Today, more people work part time, most families have two parents working outside of the home, and most full-time jobs require training beyond high school,” says Jacobs. “Economic mobility looks much different today than when this system was designed, and it’s time to catch up with — and get ahead of — the times.”

Read the full report here.

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