TRAVERSE CITY — Tow truck companies. Pet stores. Nursing homes. Hotels.
Seemingly every employer is out fishing for the employees who were swept from the workforce by the pandemic – the employees who kept fast-food lines moving, hotel rooms open, and hospitals from the brink of dysfunction.
Now, they might have more luck. Almost 5,000 people in Northwest Michigan lost expanded unemployment benefits over the Labor Day Weekend, marking an end of more than a year of government support for workers affected by the COVID-19 pandemic.
In Grand Traverse County, about 2,300 unemployed will be affected by the lapse, according to the Michigan Unemployment Insurance Agency, the state office which manages unemployment payments.
With Antrim, Benzie, Kalkaska, and Leelanau counties in the mix, more than 4,700 former workers will be affected overall. In total, the program had been dispersing $1.4 million dollars in expanded benefits each week to residents of the six counties. Individuals on the expanded benefits received $1,200 per month in addition to regular unemployment payouts.
As a result of the lapsed benefits, Michigan Works Chief Operations Officer Terry Vandercook said he expects to see some uptick in workers returning to the local labor market.
“It’s likely that there were some individuals who weren’t entering the workforce because of those extended benefits,” said Vandercook. “But that’s just one of the factors that we feel is adding to this work shortage – there are many other factors.”
Vandercook said the number of employees returning to the job market has been steadily increasing for months. That’s partially because of lures being used by employers, he said. For months now, many employers have begun offering expanded benefits, higher wages, and signing benefits in the thousands of dollars.
There are other factors that have throttled the local job market, however. A lack of affordable housing has left some employers with their hands tied after having job offers accepted, and the 10-county region served by Michigan Works has lost more than 30 percent of daycare providers, which has stopped the job application process for working parents before it might have even begun. Daycare itself has become more expensive, Vandercook said.
“If you’re a working family, you have to make the decision of, one, is childcare available? And two, is childcare affordable?” Vandercook said. “We believe that is a factor as well.”
State Rep. John Roth said he’s glad that the unemployment benefits have come to an end.
“The expanded unemployment made it too lucrative. $300 a week? That was over the top,” Roth said. “People were able to stay home and not even consider working.”
Roth said his office had numerous calls from business owners who’d been told by their employees that they just weren’t interested in returning to work. This was particularly true for entry-level employees.
“It was time for it to end,” Roth said regarding the expanded benefits. “It did its purpose when the pandemic was at its height. But now it’s time to get people back to work. There’s a lot of great jobs out there.”
Roth said it was easier to say goodbye to a program so riddled with problems. For months, Roth has been a leading critic of the Michigan Unemployment Insurance Agency.
Roth said that the department “knowingly refused benefits to people who were eligible” because of software issues at the agency. He’s also accused the UIA of giving out benefits to ineligible recipients for months.
But Roth was particularly concerned with people who didn’t receive unemployment benefits for months throughout the pandemic.
“There were people that slipped through the cracks at all times,” Roth said. “We’re still getting calls.”
Nationwide, there has been little to suggest that ending the benefits will result in an immediate uptick in employment numbers.
A number of studies have looked at states that dropped expanded benefits earlier this year. One study from researchers at Columbia, Harvard and the University of Massachusetts found only a slight uptick in employment when the $1,200 benefits disappeared. In states without the pandemic unemployment benefits, about one in eight formerly unemployed workers went on to find work after six months.
Roth said he had some concerns about those studies, but added that he didn’t think the end of expanded benefits was the only solution to the current employment dilemma. He also cited daycare, and of course, finally ending the COVID-19 pandemic.
“Until we solve that, we are going to struggle,” Roth said.