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Michigan’s Unemployment System Ill-Equipped to Deal with Historic Claim Rates

— April 14, 2020

Michigan’s Labor Department estimates that one out of every four residents filed unemployment claims by the morning of Tuesday, April 14th.

One out of every four Michigan residents is out of work because of the coronavirus.

According to, the state’s been dipping into its unemployment trust fun to paid recently laid-off and furloughed workers. Since Gov. Gretchen Whitmer issued shelter-in-place orders at the end of March, more than 1 million Michiganders have filed for unemployment benefits.

The state’s so far paid out $350 million in benefits to over half a million residents. And an estimated 100,000 claimants have been approved.

All in all, the Michigan Department of Labor says that almost a quarter of the state’s workforce had filed for unemployment by the morning of Tuesday, April 14th.

Jeff Donofrio, director of Michigan’s Department of Labor and Economic Opportunity, says there’s a good chance the state’s trust fund will be half-empty by the end of July. Whether that happens, Donofrio says, depends on how many more people file for unemployment—and how long they remain out of work.

“We’ll be looking at what the federal government might provide in additional resources, and I think every federal dollar that comes in from Pandemic Unemployment Assistance, certainly the $600 extra for the newly eligible, is going to help us preserve the trust fund and be able to extend it,” he said.

Current Michigan Gov. and former Ford School faculty Gretchen Whitmer delivering a speech in 2015. Image via Flickr/user:FordSchool. (CCA-BY-2.0).

Pandemic Unemployment Assistance, or PUA, is a special, federally-funded program that expands unemployment benefits to people who aren’t usually eligible for state-run programs. Under the PUA’s provisions, contractors, self-employed people, and gig workers receive a minimum of ½ their state’s average weekly benefit, plus an additional $600 per week.

Donofrio told that, prior to the outbreak, Michigan’s trust fund was exceptionally well-funded when compared to states of similar size and population. But Michigan now has the third-highest rate of unemployment claims in the country, behind only California and Pennsylvania.

“Almost a quarter of our workforce have filed for unemployment benefits so far,” Donofrio reiterated. “We’re committed to making sure every Michigander who is eligible for unemployment benefits receives them. We’ve seen historic increase in the need and, of course, in the filing for unemployment benefits as well, because of COVID-19.”

And indeed: that historic demand has devastated Michigan’s unemployment systems. Residents have complained of the unemployment agency’s website being borderline unusable, crashing every several seconds. And the department’s phone lines have been perpetually jammed, making it next-to-impossible for people to file claims over call or resolve technical holds on their accounts.

Matthew McCauley told West Michigan-based 3WWMT that his unemployment claims have been repeatedly rejected, despite following advice from Labor representatives.

“I’ve called [Unemployment] probably over 100 times a day, every day, to try and actually speak with someone over the phone, to no avail,” McCauley said.

Michigan has since attempted to upgrade its web infrastructure, although that didn’t stop the website from going down for several hours on Monday. Labor has also hired hundreds of new officials to assist in processing unemployment claims.

“We’ve been assured by [the Department of Technology, Management, and Budget] that there are more servers online and that we’re able to handle a large capacity of people access this,” Donofrio said. “We’re going to continue to do everything possible and throw every piece of equipment and technology we can at this to make sure that people can get their benefits.”


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