Amid worker shortage, Michigan to restore job search rule for jobless aid

Aug. 25: 500,000-plus jobless Michigan workers brace to lose unemployment benefits
July 20: Michigan unemployment benefits secure for those who ‘followed the rules’
July 13: Michigan changed unemployment rules. Now 648,000 may have to repay benefits

LANSING—Unemployed Michiganders will need to prove they are searching for jobs to continue qualifying for benefits when the state restores a suspended requirement by the end of May, a change employers are clamoring for as they struggle to fill openings.

“We’re hearing from our members that hiring people right now is harder than it has ever been,” said Brian Calley, CEO of the Small Business Association of Michigan, which advocates for employers across the state in Lansing.

“Reinstating the work search requirements and having an accountable process, to show that an individual is at least applying for jobs is very important to our future.”

For decades, Michigan has required jobless assistance applicants to prove they are searching for work by applying for jobs, participating in job fairs, employment workshops or by searching job listings online at sites like Monster.com.

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Gov. Gretchen Whitmer suspended the work search requirement in March of 2020 as the state’s unemployment rate soared above 22 percent amid forced business closures that aimed to control the spread of COVID-19. 

But with the state unemployment rate now back near five percent, the Whitmer administration is planning to restore the requirement. The Unemployment Insurance Agency has not specified an exact date, but the state has begun telling claimants it will happen “soon.”

“Plans are to reinstate the work search requirement at the end of this month,” UIA spokesperson Lynda Robinson said Tuesday. “Claimants will need to actively search for work and report at least one work search activity per week for each week they claim benefits.”

Restoring the job search criteria is among a series of changes business groups are advocating for in Lansing amid a widespread worker shortage. It comes as the state prepares to allow office spaces to reopen later this month because at least 55 percent of eligible adults have received a COVID vaccine shot.

House Republicans last month proposed a $400 million “return to work” program that would provide $1,000 grants to individuals who leave the unemployment system for a new job, an attempt to help employers compete with enhanced federal benefits.

The Detroit Regional Chamber on Monday proposed its own plan aiming to get 100,000 jobless residents back in the workforce by Labor Day and encouraged lawmakers to fund it with federal stimulus dollars.

It includes a $2,000 return-to-work grant for employees, a $1,000 employer training grant for each new employee and a $100 for employers to incentive worker vaccination or give them paid time off to receive an inoculation shot.

“Ensuring job creators have the talented people needed to meet consumer demand and accelerate Michigan’s economic recovery is a goal we share.”  Detroit Regional Chamber President and CEO Sandy Baruah told lawmakers in a letter also sent to Whitmer. 

The state would have restored the work search requirement sooner if it weren’t for technological challenges, UIA Chief of Staff Stephanie Glidden told lawmakers last month in testimony before the House Oversight Committee, noting the need to modify the agency’s new phone systems so claimants can report work search requirements by phone or online. 

As of late April, Michigan had about 700,000 active jobless benefit claimants, including about 170,000 people who interacted with the unemployment agency only by phone, Glidden said. Many of them joined the system for the first time during the pandemic so do not have experience with reporting work search information, she told lawmakers.

Telling claimants how to do so is “going to be key,” Glidden said. “Work search mistakes have proven to be costly for unemployment claimants — if they make mistakes, their benefits are in jeopardy — so we don’t want to just throw this mandate on them without educating them.”

The state is ready to restore the search requirement because “the availability of the COVID-19 vaccine and the reopening of workplaces offers an opportunity for people to be able to return safely to work,” Robinson, the agency spokesperson, told Bridge.

Additional steps are needed to lure workers back into the job market, Wendy Block of the Michigan Chamber of Commerce told lawmakers in committee.

Some workers still fear COVID, others are staying home while their kids remain in virtual school and some are simply deciding not to return to work because of enhanced unemployment benefits that pay more than $15 an hour, the equivalent of about $34,000 a year, she said.

“There’s also a classification of employees who aren’t getting that nudge they need to look for work, or to know who to turn to,” Block said. “And that’s why these work search requirements are so important.”

The unemployment agency this month started telling claimants about the pending work search requirement. It’s also promised to release additional details in the near future, including information on waivers that could be granted for COVID-19 reasons. 

Once reinstated, the UIA will ask claimants when and how they applied for a job and the company’s contact information. Claimants can submit that information during their benefit certification process by phone or online.

Michigan law, temporarily waived during the pandemic, requires claimants to make “job contacts” each week and keep a record of their searches. After receiving benefits for half their maximum weeks, claimants are expected to accept any “suitable” work offers.

Labor groups have urged businesses to boost worker pay, especially in the restaurant industry, in order to attract employees in the midst of what is still an ongoing pandemic.

Mothering Justice and the Restaurant Opportunities Center on Tuesday sued Michigan in an attempt to restore a 2018 initiative that would have gradually increased restaurant worker minimum pay by eliminating the lower tipped wage.

But even companies that offer more pay than residents can qualify for through unemployment benefits are struggling to find workers, Calley told Bridge Michigan. 

“I don’t think a lot of people in government truly understand that the employer is not in a position where they simply have to beat unemployment (pay),” he said. “You might be able to compete with the money, but you can’t compete with 100 percent time off.”