Over 129,000 Michigan residents filed jobless claims last week; is it 'irrelevant'?

Beth LeBlanc Craig Mauger
The Detroit News

More than 129,000 people filed jobless claims in Michigan last week as the fallout of drastic measures to contain the spread of COVID-19 slammed the state's economy.

The claims occurred from March 15 through Saturday and were part of almost 3.3 million new claims nationwide. The new unemployment filings in Michigan were about 24 times the filings for the previous week and over a similar period in 2019, according to tracking numbers from the Associated Press.

Across the United States almost 3.3 million people applied for unemployment benefits in the last week, four times as much as a previous record set in 1982.

“The shocking number of unemployment claims this week underline the risk of a corona-depression," said East Lansing-based economist Patrick Anderson. "We estimated last week that 104 million workers would lose income in the next 45 days; a good number of them already have.

People wait in line to enter the unemployment office at New Center One in Detroit, Wednesday, March 18, 2020.

During the Great Recession, between October 2008 and July 2009, an average of 31,500 initial claims were filed in Michigan on a weekly basis with a peak week of 77,000, according to data from the Michigan Department of Labor and Economic Opportunity.

The Michigan numbers for March 15-21, 2020, are up 67% over that peak week from the Great Recession.

In an interview with CNBC Thursday regarding the passage of a $2 trillion stimulus bill, Treasury Secretary Steven Mnuchin downplayed the new unemployment numbers as “not relevant.”

“Obviously, there are people who have jobless claims and again the good thing about this bill is the president is protecting those people,” Mnuchin said.

“Now with these plans, small businesses hopefully will be able to hire back a lot of those people. Last week they didn’t know if they had any protections. They didn’t have any cash. They had no choice.”

But Anderson countered that 3 million jobless people nationally "isn’t an irrelevancy" but "a potential insurgency."

"I agree with the Secretary that federal support is needed, and applaud his personal efforts to get it done," Anderson added. "The 3 million people underline the importance of getting help to employers as soon as possible. We need to get these folks back to work, or we are facing a corona depression."

Among Michigan's 83 counties, Washtenaw County had the biggest percentage uptick in unemployment claims. It grew from 1,343 claims in the week ending March 14 to 5,286 claims in the week ending March 21 — a 294% surge.  

But Wayne, Oakland and Macomb counties saw the largest aggregate increases overall. 

Wayne County's unemployment claims increased by 152%, from 15,901 in the week ending March 14 to 40,025 in the week ending March 21. 

Oakland County increased 205% from 7,810 to 23,799 claims in that same time frame, while Macomb County grew 197% from 7,596 to 22,543. 

Michigan Gov. Gretchen Whitmer on March 16 expanded eligibility for benefits in the wake of COVID-19 closures and suspended rules requiring in-person registration and work search requirements.

She clarified the order in a separate edict Wednesday, noting the requirement for an employee to request a registration and work search waiver was suspended. She also said anyone with an active unemployment claim would get a six-week benefit extension and state cost-sharing with employers would be expanded. 

“These are challenging times that all Michiganders are facing, and no one should be worried about how to make ends meet if they cannot work because of self-isolation or self-quarantine in response to contracting the coronavirus,” Whitmer said in a Wednesday statement. 

Michigan's unemployment benefits are paid for through "a $4.6 billion trust fund which has been built up over the last 10 years," said Jason Moon, a spokesman for the Department of Labor and Economic Opportunity.  

With the influx of claimants, the Unemployment Insurance Agency added server capacity last week, but the system still is running slowly. At the same time, the state closed off its lobbies, with the exception of appointments, to prevent the spread of the disease. 

On March 18 alone, 32,000 people filed online for unemployment in Michigan. 

On Monday, Whitmer issued an executive order that forces businesses that don't provide "critical infrastructure" work to scale down their activities to "minimum basic operations." She's previously issued orders specifically closing nail salons, hair salons, workout facilities, movie theaters, bars and dine-in service at restaurants.