With
10.3% unemployment in Michigan, Michiganders who are out of work face a lot of competition for not very many jobs. And now they could face
cuts in unemployment benefits:
Legislation introduced by House Commerce Committee Chair Representative Wayne Schmidt and Representative Joseph Haveman (HB 4781) would reduce UI payments by adopting the most restrictive formula for calculating weekly benefits. Currently, weekly benefit amounts are based on the highest quarter of earnings within the four-quarter base period that determines a worker’s eligibility for UI. Rather than using the high-quarter earnings—the practice in 28 states—Schmidt’s bill would base the benefit amount on the average of 52 weeks of earnings. The practice—known as 52-week averaging—is used by only 11 states and lowers weekly benefits for anyone with unevenly distributed earnings, including retail and service workers who rarely have consistent hours, as well as workers on unpaid family and medical leave and those who experience unplanned gaps between job assignments.
What would that boil down to for the people taking the cuts?
An unemployed worker who previously earned $35,000 a year would lose $42 per week in unemployment insurance, dropping from $358 to $316 a week. The effect on workers with uneven earnings is even more substantial and can result in over a 50-percent reduction in weekly benefits. A person earning $25,000 with one-third of her wages concentrated in a single quarter, for example, would face a $116-per-week penalty relative to current law.
Another bill would make it easier for employers to block former employees from getting benefits.
That's after Michigan already cut six weeks of eligibility for unemployment, from 26 weeks to 20. The justification for that was that Michigan was broke broke broke and couldn't afford to pay unemployment insurance despite its stimulative effects. However, the budget Michigan subsequently passed cut the state's corporate income tax by 86%, so apparently the fiscal crisis only applies to struggling individuals.
These latest bills cutting unemployment benefits are expected to be voted on Tuesday.