(Susan J. Demas/Michigan Advance)

Michigan could increase the value of payments and allow individuals to be eligible for longer under legislation that cleared the state Senate with bipartisan support Thursday.

It’s been more than 20 years since the maximum weekly benefit rate cap has been increased, and sponsor of Senate Bill 40, Sen. John Cherry, D-Flint, told reporters Thursday that the legislation to give unemployment benefits a bump helps keep skilled workers in Michigan when they fall on temporary hard times.

“Ultimately, this helps make sure we have a stable population. That money goes straight back into the economy and it’s really a buffer for folks who need it,” Cherry said.

If the bill, which cleared the Michigan Senate 21-15 Thursday with two lawmakers excused, makes the cut before the legislative session ends this month, the weekly maximum on unemployment benefits will shoot up from $362 to $614 over the course of three years starting with $446 a week in January of 2025. Additional funds for dependents would increase over the course of three years as well, from $6 to $26.

Michigan is the lowest in the Great Lakes region for unemployment benefits and offers the shortest length of benefits at 20 weeks, Sen. Paul Wojno, D-Warren, said earlier Thursday morning in the Senate Labor committee.

Michigan lawmakers are charged with making the lives of hardworking Michiganders better by promoting policies that establish livable wages and offer dignity to workers in health care, time with loved ones and retirement, President of the United Autoworkers Union Shawn Fain said in a letter to Michigan lawmakers Thursday morning.

“There is ample opportunity to pass legislation that helps working families and our communities before the end of 2024,” Fain wrote. “Reforms to the unemployment insurance system are desperately needed …The eligibility requirements in Michigan are some of the most restrictive in the country.”

There are many members of the business community that oppose such a steep increase in weekly caps in unemployment benefits, Amanda Fisher, state director of the National Federation of Independent Businesses told lawmakers in the Senate Labor committee Thursday.

“I think there is room for discussion on an increase … I think that is reasonable,” Fisher said in considering the decades that have passed without an increase. “I think the problem you have, especially with my members, is when they can’t find people to work, that it makes it very difficult to say, ‘Okay, well, we need to increase unemployment, because there are jobs available.”

When people receive unemployment payments, they spend them in the state’s economy, Sen. Darrin Camilleri, D-Trenton, said, reasoning that businesses benefit when families are able to participate in the economy.

But the unemployment system is getting exploited by those who’d rather receive benefits the way they are, Fisher said and increasing the duration and value of payments isn’t conducive to a stronger economy as businesses struggle to find workers.

“If they have lost their job through no fault of their own, I know my members want those folks to have benefits, but there are other issues too,” Fisher said, relaying that business groups have said they’ve gone to interview prospective workers who only apply to be able to present proof of search in order to keep getting unemployment benefits.

If the bill becomes law, it would have a significant fiscal impact on the Unemployment Insurance Trust Fund, where benefits are paid out from, according to an analysis from the nonpartisan Senate Fiscal Agency. About a third of claimants reach 20 weeks of receiving benefits and increasing the maximum to 26 weeks would “likely increase” the amount of time claimants stay on unemployment benefits.

There are few states that offer less time to collect unemployment benefits than Michigan, as most states offer 26 weeks. In fact, Michigan used to offer 26 weeks until the Republican-led state legislature and GOP Gov. Rick Snyder reduced the duration from 26 weeks to 20 weeks in 2011.

During the height of the COVID-19 pandemic, Gov. Gretchen Whitmer temporarily raised unemployment benefits to 26 weeks maximum through an executive order in order to combat the economic insecurity many Michiganders faced during the pandemic.

Several Republicans in the Senate joined the Democratic majority in voting through the expansions to unemployment benefits. Now the bill must be considered in the flurry of bills going through House committees this month in order to receive a vote to get to the governor’s desk in time before session ends.

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