(WWJ) The CEO who runs the lobbying group for the Big Three and other manufacturers is bracing its membership as the state unemployment fund dwindles.
WWJ's Lansing Bureau Chief Tim Skubick reports millions of dollars are flowing out into the hands of the unemployed ... and there are so many out of work not much is flowing in.
Will the businesses still in operation have to replenish it? And how much will they have to pitch in? Those questions remain to be answered, but a few things are known.
"This has been an extraordinary drain on that fund," said John Welsh, who runs the Michigan Manufacturing Association of the money that comes from payroll taxes on employers. adding, "It's now being deployed as it should be, but it's possible (businesses will have to replenish). We're going to keep a good, hard eye on it."
Despite the many questions, however, Gov. Gretchen Whitmer said at a news conference Monday that all Michiganders should rest assured that, if they are eligible to receive unemployment benefits, they will get the money.
Per the Lansing State Journal, the state started 2020 with more than $4.6 billion in its unemployment trust fund, the account that pays weekly benefits to people to laid-off workers, which was the third-highest balance among the 50 states.
That's a healthy sum, far higher than the roughly $40 million in reserves at the start of the Great Recession, Unemployment Insurance Agency spokesperson Jason Moon told the Journal in an email.
But the huge number of unemployed will make short work of that fund, draining it in an expected 14 weeks at the current level of unemployment.
Friday's new jobs report showed that about 20.5 million American jobs were lost in April -- the largest drop since the government started tracking job loss in 1939.
It puts the United States unemployment rate at a staggering 14.7%.
In Michigan, nearly 69,000 people filed initial claims for unemployment last week, bringing the state's seven-week total in the coronavirus pandemic to more than 1.3 million.
