Editorial: Back-to-work bonus could help employers
It runs against nearly everything we believe to support a plan for the state to bribe reluctant workers off the dole to take available jobs in a growing economy.
But that's the reality of the situation in Michigan, where worker-starved employers can't compete with the rich unemployment benefits being paid by the federal government.
A state House panel last week advanced a proposal that would use federal COVID-19 relief funds to pay a one-time $1,000 incentive to those willing to leave unemployment to take job.
The estimated cost of the Return to Work proposal is $400 million, which would normally be a shocking amount, but in the world of billion-dollar handouts from Washington seems like pocket money.
Michigan has $13 billion in extra Biden cash to spend, an amount larger than its annual General Fund budget.
So why not help employers find workers so they can fully reopen their businesses and start generating real revenue for the state Treasury?
More than 800,000 Michigan residents remain on unemployment, even as help-wanted signs paper the windows of most businesses in the state.
Many restaurants have been unable to open full time, even at reduced capacity, because they can't find help. Some are offering signing bonuses and other perks to lure employees.
The plan's author, Rep. Thomas Albert, R-Lowell, who chairs the House Appropriations Committee, says that if 10% or 20% of those collecting jobless benefits take the thousand bucks and go back to work, it would be a huge boost to the state workforce.
Since the start of the pandemic last March more than 3.3 million Michiganians have filed for unemployment. They've collected $33.5 billion in federal and state checks. Meanwhile, Michigan's unemployment trust fund has sunk to $600 million from $4.6 billion.
Even with the bonus, it won't be easy to lure recipients off unemployment before their 20 weeks of eligibility end. Michigan pays up to $362 a week in jobless benefits, and the federal government adds an additional $300 weekly as part of the COVID relief package.
Many workers are bringing in more from unemployment than they were making in their jobs.
To be eligible for the bonus, workers would have to verify their employment status and work at least 80 hours over a four-week period.
Currently, those on unemployment don't have to be actively seeking work to be eligible for benefits. That changes at the end of the month, when the state will reimplement its work-search requirement.
The policy shift should help move people back into the workforce — if the state is aggressive in enforcing the rule.
But the biggest motivator won't be the $1,000 bonus or the work search mandate. That will be an end to the supplemental checks from the federal government.
Workers have to see they'll be better off in jobs than on unemployment.