Over the last year, 70,000 Michiganders have lost their jobs.
In February alone, 6,000 became unemployed as numerous businesses issued layoff notices.
According to Wayne Rourke, labor market information director for Michigan’s Center for Data and Analytics, the state’s “unemployment rate has gone up slightly in the first two months of the year, mainly due to a rise in the number of unemployed people.”
He also noted in a statement the “size of the state’s labor force and number of payroll jobs have also increased in both January and February.”
The reality is February’s one-tenth of a percentage point increase in unemployment to 5.4% marks the 11th straight month of growing unemployment in the Great Lakes State, which is now at the highest rate since September 2021, when it declined to 5.6% as the pandemic waned.
Rourke told WEMU factory workers returning from layoffs last month mitigated some manufacturing job losses, but weak demand for new vehicles continues to drive workforce reductions.
“So, what we’re seeing now is in sectors such as manufacturing and professional and business services, those are still our weakest sectors over the past year or so,” Rourke said. “Our retail trade has also been declining since last year. That’s not really a surprise due to all the news we’ve seen.”
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Michigan’s one-tenth of a percentage point increase in unemployment in February mirrored the national increase, though the U.S. rate remained 1.3 percentage points lower at 4.1%.
In total, about 4,825,000 Michiganders were employed in February, while 274,000 were unemployed, in a state with a civilian labor force of 5,099,000.
In February 2024, 204,000 Michigan residents were unemployed, according to the Michigan Department of Technology, Management & Budget.
Nearly half of the 70,000 increase in unemployment over the last year was located in the Detroit metro area, where the number of unemployed jumped 36.1% over the last 12 months, going from 83,000 to 113,000.
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In terms of industry trends, the state’s construction, trade, transportation, and utilities, private education and health services, leisure and hospitality services, and other services shed jobs in February, while manufacturing and professional and business services added jobs.
“Michigan’s manufacturing sector recorded payroll job gains (+7,000) following four consecutive months of declining employment in this industry,” according to the MDTMB. “On a numerical basis, the most pronounced over-the-year industry job gains occurred in private education and health services (+23,000) and government (+8,000).”
The biggest losses over the year came in the state’s critical manufacturing industry, which lost 11,000 despite the gain of 7,000 in February.
February’s unemployment numbers come as the state prepares to implement changes to unemployment insurance that will boost payouts by as much as $84 per week under legislation approved by Democrats last year.
The changes, which increase the maximum weekly to $362, also add six weeks to eligibility, allowing Michiganders to collect benefits for up to 26 weeks, and more than doubles bonus payments for dependents.
The changes, which take effect April 2, “will put extra money into the pockets of thousands of Michiganders at a time when they need it most,” Jason Palmer, director of the Michigan Unemployment Insurance Agency, said in a statement.
Benefit increases of $84 a week are scheduled to continue annually through 2027, when weekly payouts will reach a maximum of $614. In 2028 and beyond, the weekly benefits will increase based on the national Consumer Price Index.
Based on current trends, a Senate Fiscal Analysis predicts the increase in the weekly benefit maximum could add $531.1 million in additional pay outs annually in 2027, bringing the total annual UI payouts to up to $1.4 billion.
“Total pay outs would be even higher during an economic recession,” the analysis read. “The total would be less than the total amount of UI revenue generated, which currently is $1.2 billion and would decrease the Unemployment Insurance Trust Fund balance, which is currently at $2.8 billion.”
Republicans and business leaders who opposed the changes have noted the increased benefits will ultimately come from employers who are already struggling to maintain jobs.
“Dramatically raising the amount and the length of unemployment benefits almost certainly would lead to higher state unemployment taxes for businesses than they would otherwise face,” Sen. Thomas Albert, R-Lowell, said in a statement cited by the Detroit Free Press. “And we should not be adopting policies that further raise costs for job providers when they are already reeling from the same inflationary pressures and other economic factors that all Michiganders have faced for the last few years.”