Column: How to fix Michigan’s unemployment system for the long haul

Unemployment Insurance Agency, Lansing | Susan J. Demas

Faced with record-breaking joblessness due to the COVID-19 pandemic, Michigan has done an admirable job of quickly patching up its unemployment insurance system to handle a tsunami of claims. Now it’s time for the Legislature to make those temporary fixes permanent. 

Michiganders and people across the nation are struggling with unemployment at a level not seen since the Great Depression. Since March 15, more than 1.7 million Michiganders have filed for unemployment. 

A review of the metrics shows that under Gov. Gretchen Whitmer, Michigan’s Unemployment Insurance Agency (UIA) is doing an effective job of getting benefits out the door. Using her emergency powers, Whitmer has temporarily patched up some of the biggest holes blown in the system by the Snyder administration and the Republican-led legislature’s neglect and virtual dismantling of the state’s UIA system. 

Here’s how the Michigan UIA is doing by the numbers: Among large states, Michigan trails only New York in the percentage of claims processed. To date, 92% of the state’s eligible jobless claims have been paid or approved to receive benefits. 

This is a remarkable achievement, given the numerous roadblocks erected by the former Gov. Rick Snyder administration, which slashed how long Michiganders can receive UI benefits and made them harder to access. 

State has spent $8.5B on unemployment, $251M on PPE

They also implemented a new “MiDAS” benefits information technology system aimed at slashing the unemployment rolls under the pretense of monitoring fraud. However, the system was highly inaccurate and erroneously flagged at least 37,000 workers for fraud. 

These harsh measures hurt workers of color the most, since the average duration of unemployment for African-American and Asian workers in Michigan was 27.7 weeks, while for white workers it was 19.7 weeks. It is no wonder that cities like Detroit and Flint never fully recovered from the last recession and still have astronomical unemployment rates among African American people of 17.4% and 25%, respectively

Transitioning this system to one that presumes unemployed workers ought to get help is a huge undertaking that cannot happen instantly. The Whitmer administration should be commended for how quickly it’s turning it around. 

Whitmer’s March 16 executive order restoring the maximum benefit duration to 26 weeks and improving access made Michigan one of the first states to take this kind of action. 

Unemployment chief: Pandemic is ‘user testing on steroids’ for state system

The governor then issued another executive order to extend eligibility to workers affected by COVID-19, expand “work sharing,” and waive the onerous “rework” rule that requires workers to earn $6,000 with their employer before becoming eligible to receive unemployment benefits. This rule would have blocked benefits for many workers who had changed jobs before the pandemic hit. 

Michigan also was one of the first states to roll out the new Pandemic Unemployment Assistance program that includes self-employed workers who lose their jobs. The program also established streamlined methods of applying for and paying PUA benefits that are now models for other states. 

Unfortunately, these changes are only temporary. The next step is for the Michigan Legislature to permanently codify these system improvements and pass legislation to make these reforms permanent, as some state House and Senate democrats have proposed. That will put Michigan on solid footing to help Michiganders weather job loss now and in the future.