What economists call “The Great Recession” hit Michigan earlier and harder than anywhere else.
And now hundreds of thousands of Michiganders are coming to the end of their unemployment benefits. In normal times, people who lose their jobs are eligible to collect benefits for a maximum of twenty-six weeks, or six months. The most they can get is $362 dollars a week, out of which they have to pay federal taxes.
That amounts, by the way, to a gross income of just under nineteen thousand dollars a year. That’s considerably less, by the way, than it costs to keep somebody in prison.
Since times have been so bad, Congress has extended the eligibility period in hard-hit states like Michigan to a maximum of ninety-nine weeks for some workers, or just less than two years. But even that has proven not to be enough, in a world where there are eight and a half job seekers for every available job.
Now, a huge number of former workers are running out of time. According to the Michigan Unemployment Insurance Agency, 142,733 workers will lose their last benefits by November 30.
That’s pretty grim news, with the first chill of winter in the air. Things get worse from there. By the end of April, that number is expected to more than double, to more than 324,000.
The number of people affected by this is, of course, larger, since some of these folks are supporting families. The ripple effect on the already battered Michigan economy will be further devastating.
Those losing their final benefits, by the way, aren’t overwhelmingly in any one region of the state. Nearly half are in the tri-county Metropolitan Detroit area, but that’s close to that region’s share of the state’s population.
Eleven thousand workers in the county including Grand Rapids lose benefits; ten thousand in the Flint area. Senator Debbie Stabenow has introduced legislation further extending unemployment benefits. But its future is, at best, uncertain.
Whatever happens in the elections, the new Congress is expected to be more conservative than the old. While military spending remains high, there is growing concern about the ballooning federal deficit, now by far the largest in history.
But nobody seems to have devoted much thought to what is going to become of our state’s hundreds of thousands of hopelessly long-term unemployed. Congressman Gary Peters has introduced a sensible bill that would allow them to withdraw funds from their IRA retirement accounts without paying the usual penalty.
Unfortunately, it has been languishing in committee, as the wife of an unemployed former Chrysler worker told me yesterday.
Passing both bills would seem to be common sense -- especially from the standpoint of those who still have jobs.
Large deficits may make us uneasy. But I would think that the prospect of hundreds of thousands of desperate folks who lack money, jobs or hope ought to make us uneasier still.