Feds OK extra $300 a week for Michigan jobless – but it may not last long

LANSING — Nearly a million Michiganders who have lost jobs during the coronavirus pandemic will eventually qualify for $300 per week in extra unemployment benefits, but the payments could take weeks to arrive and may not last long. 

The Federal Emergency Management Agency on Friday approved Michigan's application for the temporary benefit enhancement, which will replace a $600 per week Pandemic Unemployment Assistance program that expired at the end of July. 

President Donald Trump on Aug. 8 used an executive order to make $44 billion in disaster relief funding available to states after congressional negotiations on another round of federal assistance legislation stalled.

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Approval of Michigan's application is "good news for the thousands of Michiganders who are still without work as a result of the COVID-19 pandemic, but it’s still a short term band aid that falls short of what’s needed," Gov. Gretchen Whitmer said in a statement. 

The Michigan Unemployment Insurance Agency did not apply for a larger $400 per week benefit because it would have required the cash-strapped state to cover a quarter of the cost — up to $100 million, per Whitmer administration estimates.

The state expects that as many as 910,000 Michiganders will qualify for the extra $300 per week, which is on top of the traditional maximum of $362 a week in jobless benefits and will be retroactively provided to claims that were active as of Aug. 1. 

However, Michigan has not yet indicated how long it will take to reprogram its computer system to administer the benefits. The U.S. Department of Labor estimates it will take states an average of three weeks to do so. 

“Based on our interaction with other states, many states expect that implementation will take longer than" three weeks, said spokesman Jason Moon. "We're evaluating ongoing guidance from the [U.S. Department of Labor] and will soon provide an implementation timeline."

The federal government says the enhanced unemployment benefits will last until Dec. 27 or until the $44 billion made available by Trump's executive order runs out.

For now, the Trump administration is only guaranteeing states will receive funding for three weeks. Additional allocations "will be made on a weekly basis in order to ensure that funding remains available for states who apply for the grant assistance," according to guidance from the Federal Emergency Management Agency. 

Experts say enhanced unemployment benefits have helped blunt some of the impact of massive job losses and business closures during the pandemic. 

And the lack of clarity on what would happen once the $600 per week Pandemic Unemployment Assistance program expired caused economic uncertainty for laid off workers across the United States, according to Gabe Erlich, economist at the University of Michigan.  

“It remains urgent … to give people the ability to plan for their future, going forward, and to know what economic policy is going to look like," Ehrlch recently told Bridge. 

Related: Michigan unemployment system designed to slow payments working all too well

The CARES Act, a $2.2 trillion federal spending plan that had included the $600 per week unemployment benefit, “protected a lot of people from serious financial hardship," Ehrlich said. 

At least 2.4 million Michigan residents have filed for jobless benefits since the coronavirus prompted business shutdowns and a statewide stay-at-home order in March. About 535,000 Michigan claimants were receiving ongoing payments at the start of August.

Whitmer, who closed down the state economy in March as the coronavirus hammered Michigan, has relaxed regulations for most businesses sectors but has still not allowed some sectors to reopen, including gyms, movie theaters and bowling alleys.

The governor said Wednesday that the state health department is reassessing those continued closure orders and may have new recommendations next week. 

The state's leading business groups on Thursday sent Whitmer a letter urging her to allow businesses that remain closed to reopen, volunteering to work with the administration on a plan to do so "safely based on science and the latest research. 

"These businesses have been completely closed after months of the public health emergency, while still facing property tax bills, rent, payroll and other expenses," said the letter from the Detroit Regional Chamber, Michigan Chamber of Commerce, Grand Rapids Chamber and Small Business Association of Michigan.

"This has placed businesses in extreme hardship, resulting in permanent closures and layoffs."