How some Michigan counties are insulated against coronavirus unemployment

Unemployment now affects over 20 percent of Michigan workers, but a look at the filings show sharp divisions in areas most affected by job losses.

Regions with an educated workforce and diversified economy have a smaller percentage of workers affected by unemployment than rural areas and manufacturing centers, based on an initial county-by-county look at coronavirus-related jobless claims.

 

That’s a pattern shown in previous economic downturns, and it already raises some concerns for Michigan’s comeback, said John Austin, director of the Michigan Economic Center. 

“Places with the old, classic Michigan monoculture are going to be hit hard,” Austin said of manufacturing-intensive regions. “They are the hardest hit, and they’re probably going to be the hardest to come back in the long term.”

Bridge Magazine examined the labor force data in each of Michigan’s 83 counties, comparing the number of people in the labor force at the end of February to the jobless claims reported by the state as of April 18.

The results provide a ranking of counties by percentage of filings within each county’s workforce. The percentage uses initial claims and is not a direct measure of unemployment. Some claims also represent furloughed workers, who are facing a temporary job loss, but not layoff.

However, the numbers show how many people in each county are seeking relief from a loss of income, and how that number compares to the overall labor market before coronavirus took a hold of the economy. A total of 134,119 state residents moved into the system over the past week, according to data released April 23, bringing the total to 1.178 million Michigan residents who have filed for unemployment benefits since March 15, according to the federal Bureau of Labor Statistics. At least 20 percent remain in the system and approved for benefits.

Places like Oakland County, Washtenaw County and much of West Michigan are faring relatively better at under 20 percent unemployment than areas like the manufacturing centers of Detroit, Macomb County and the I-69 corridor in the Thumb Region, where as many as 32 percent of workers have filed for unemployment.

 

West Michigan’s relative strength in the overall jobless rate is the result of deliberate changes to what types of businesses the region pursued over the past 20 years, said Birgit Klohs, president and CEO of The Right Place Inc, a 13-county economic development group.

“We used to be primarily a manufacturing-based economy, but now we have intentionally diversified into the health sciences, technology and food processing sectors,” said Klohs. 

“Our regional economy was built by family owned businesses and thousands still remain today, she said. “These businesses are heavily involved in the local community and are more likely to pursue layoffs only as a last resort.”

Washtenaw County also is among the most stable larger job markets in the state, based on mid-April numbers. At that point, 10.5 percent of its workforce had filed for unemployment. 

However, news this week that the University of Michigan faces up to $1 billion in coronavirus losses across its campuses and medical system sounded a warning to the community. U-M President Mark Schlissel said layoffs could be coming to U-M’s 49,000-employee workforce, among the largest in the state.

“The university has always been a nice buffer,” said Amy Cell, a human resources consultant based in Ann Arbor. Cell worked for economic development at Ann Arbor SPARK as the Great Recession reached the city, just after Pfizer closed its 2,000-employee center there. 

“We have a diverse economy and a lot of stability in the economy,” Cell said of Ann Arbor. “Now layoffs in the health care sector and possibly education are really throwing a curveball.”

In Lapeer County, north of Detroit, the potential jobless reached about 33 percent, the highest in the state, according to the county-level look at unemployment claims and the labor force. Two additional counties also topped 30 percent: St. Clair County and Cheboygan County. 

Michigan as a state counts its highest number of jobs in health care, manufacturing, government - like schools and universities - followed by retail then professional and technical services,  according to 2018 data from the BLS. 

A look at top employment sectors in Lapeer and  St. Clair counties shows the disparity. Both rely on manufacturing more of their jobs, while the professional services sector doesn’t make the top 5. In Cheboygan county, the top employers are hotels, restaurants, and retail - all industries especially vulnerable to the coronavirus shutdown. 

Lapeer Development Corporation Executive Director Quinten Bishop described the number of filings as “really damning” for a community that had gained some redevelopment momentum early in the year.

Now, Bishop said, finding and focusing on survival solutions is his primary goal. He initiated a Lapeer County Economic Task Force on April 21 to provide advice for employers throughout the county.

The situation in Lapeer is mushrooming regionally. Of the top 10 counties in Michigan with the highest percentage of potentially jobless, five are counted among the seven counties comprising the I-69 Thumb Region.

“We are all experiencing the same labor forces working against us,” Bishop said. One issue, he said, is that the region’s larger manufacturers are laying off high numbers of their employees, making it hard for workers to find new jobs amid the extreme slowdown. Businesses that support those workers, in turn, are having to contract or close.

“The layoff trend … does not allow our people to get back to work,” he said.

That’s also a concern in Cheboygan County, which had the second-highest unemployment rate in the state at the end of February, at 14.3 percent. That community, home to Mackinaw City and the Lake Huron community of Cheboygan, was behind only Mackinac County in unemployment before coronavirus. Mackinac County, located directly north of Cheboygan County but across the Straits of Mackinac, had an unemployment rate of 17.9 percent over the winter. Those high rates came at a time when overall Michigan unemployment was 3.6 percent, according to seasonally adjusted numbers from the Bureau of Labor Statistics. 

“We have a lot of unemployment during the winter in this community,” said the Rev. David Wallis, pastor of Church of the Straits. Wallis and his congregation offers a food pantry during those months, when workers who make the most of summer jobs no longer can go to work. 

Now, Wallis said, the community is facing what spring will mean to that dynamic as jobs disappear.

“When things open up at the end of April, and in May, people go back to work again,” Wallis said.

The state’s workforce development staff is starting to connect unemployed workers available jobs, though many employers have slowed hiring.  More steps may be taken in the future, they said, as trends emerge along with increasing demand for services, prompting some people to return to work.

We are developing additional comprehensive strategies now that will help get Michiganders back to work when it’s safe to return to work,” said Mike Murray, spokesperson for employment and training in the Michigan Department of Labor and Economic Opportunity.

By the time the second quarter ends in June, economists at the University of Michigan expect the state will have lost 1.2 million jobs. That compares to 140,000 jobs lost in the first quarter of 2009 during the Great Recession.

Those estimates include 49 percent of Michigan’s workforce considered essential, and 33 percent of Michigan workers able to work from home. They also assume that 500,000 state residents are out of work because of lack of demand for their services.

It also counted an estimated 740,000 workers who are not working, but are still being paid. That is expected to change in May “as workers exhaust their paid time off and employers become less able or willing to maintain idle workers on payrolls,” according to estimates in U-M’s report. 

Even with three-quarters of idle workers expected to return to jobs by fall, the report says, Michigan’s unemployment rate is heading toward 23 percent for the second quarter. The previous peak was 14.4 percent in the third quarter of 2009. It should fall to 9 percent by the end of September.

As Michigan hopes soon to aim for recovery, Klohs cautioned that areas not experiencing peak jobless claims still suffer along with the state as jobless claims reach heights that exceed Great Depression levels. 

“While West Michigan has diversified its economy and is experiencing comparatively lower unemployment rates, we are still cognizant of the many industries here that are interconnected with and impacted by the statewide economy,” Klohs said.

More on unemployment filings:

Michigan’s Department of Labor and Economic Opportunity updates the county-level unemployment numbers following the initial claims to reflect how many workers are in the system.

Based on those numbers as of April 18, the following 10 counties have the highest number of unemployment claims by percentage of the labor force (see interactive map for details):

  • Lapeer, 32.7
  • Cheboygan, 31.2
  • St. Clair, 31.1
  • Roscommon, 29.3
  • Wexford, 28.5
  • Genesee, 28.3
  • Macomb, 27.4
  • Shiawassee, 27
  • Oscoda, 26.7
  • Tuscola, 26.7

Among other labor force centers of Michigan:

  • Ingham County, 15.3
  • Kalamazoo County, 13.5
  • Kent County, 16
  • Livingston County, 20.1
  • Oakland County, 16.5
  • Ottawa County, 16.3
  • Washtenaw County, 10.5
  • Wayne County, 23.5

How to file for unemployment

The Michigan Department of Labor and Economic Opportunity continues to expand its staffing and improve technology to deal with the crush of applicants trying to access the system.

If you have lost your job and want to seek unemployment benefits, go to the state’s website for the latest information. Most applicants are asked to file online claims, with days assigned by the first letter of the applicant’s last name. Online tutorials and tip sheets are available.

Someone without internet access can call the office at 866-500-0017 from 8 a.m. to 6 p.m. Monday through Friday, or 7 a.m. to 2 p.m. Saturday.

RESOURCES:

 

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Comments

Car Guy
Thu, 04/23/2020 - 11:34pm

We are experiencing a pandemic thanks to our stupidity in allowing our manufacturing to be transferred overseas, with China being our main production source. We can’t even make enough bloody face masks as we have became a consumer nation, geared toward service industries and worthless creative financing.
The article paints manufacturing as an undesirable thing to have and that they’ll just have to languish forever before they reopen. In fact, we should have a major effort to bring more of it back to our state and bring it back online sooner. It is the goose that lays the golden egg and puts bread on many family tables. Fine, diversify into health care, etc., but remember that manufacturing and engineering supports them and not the other way around.

Tess
Fri, 04/24/2020 - 10:21am

You are 100% correct. Manufacturing needs to be moved back to the USA ...and a halt to foreign visas of all kinds until our college grads have a job and those out of work are employed again!

Joey Lane
Sat, 04/25/2020 - 12:14pm

Totally right. Elites look down on construction and factory work, but that's the backbone of our nation. Our nation's wealth was built on manufacturing and agriculture, and now the elites want to shut these industries down. We had a slow push to bring back manufacturing before this virus- hopefully people wake up and support that push more.