Monday, March 24, 2014

Unemployed in West Michigan: the Current State of Affairs

If you have been following the news about unemployment, you are likely not optimistic about any further relief for the long-term unemployed, in Michigan or elsewhere.

Here's where it stands: most states give a maximum of 26 weeks of unemployment compensation to laid off or terminated workers, but since 2011, to save money, Michigan limited the number to 20, a significant reduction from the 99 weeks' workers were getting during the recession.  Still, in 2013, with federal help, Michiganders could get a maximum of 48 weeks' assistance.

In December, 2013 federal unemployment extensions expired, and, for Michigan workers, that capped the maximum benefit at 20 weeks'. Congress has been ineffectively duking this issue out since then with various proposals in the pipeline, and last week House Speaker John Boehner rejected the Senate bill temporarily extending unemployment benefits at the federal level for the long-term unemployed as "unworkable," particularly reinstating benefits retroactively since the old law expired.

The latest unemployment statistics reveal Michigan, at 7.8%, as having the 5th highest unemployment rate in the nation, after California, Illinois, Nevada, and Rhode Island. Preliminary statistics reveal that the Grand Rapids-Wyoming metropolitan area has an unemployment rate of 5.8% (January 2014). The real unemployment rate, however, which would include the long-term unemployed who have given up hope of finding a job but have dropped off the unemployment rolls, is 10.2%, state-wide. Add to that the underemployed who would seek more or better work if they could find it, and those numbers only grow higher, probably much higher and growing as the new health care insurance laws solidify the disincentive employers have to give their workers more hours.

Some Michigan lawmakers have proposed laws that would offer tax relief for unemployment compensation at the state level or re-extend the total number of weeks to 26, but these proposals do not seem likely to go anywhere in the Michigan Legislature.

Add to this the staggering amount of student loan or underwater mortgage debt Generations X and Y are shouldering, and it's no wonder that many people in this current economy see themselves as just "picking through the rubble." Good news for the average Michigan worker seems less likely all the time, although we can of course hope that the area's economic growth will have some positive effect in job creation longer term.