Cooney, Shaefer critique early termination of extra unemployment aid

June 24, 2021

After the Michigan House of Representatives voted to end the extra unemployment aid early, Patrick Cooney, assistant director of economic mobility at Poverty Solutions, and Luke Shaefer, the Hermann and Amalie Kohn Professor of Social Justice and Social Policy, associate dean for research and policy engagement, and director of Poverty Solutions, responded with an op-ed published by the Detroit Free Press. They say Michigan lawmakers made the wrong decision.

"(Ending the extra aid) would be bad for out of work Michiganders and their families who depend on the aid," the two argued. "Less understood is the fact that it could also be bad for landlords, banks, grocery stores and a myriad of Michigan businesses, and set back the state’s economic recovery."

Cooney and Shaefer explain how unemployment benefits have kept Michigan's economy strong, even through the COVID-19 pandemic and recession.

"Despite historic rates of unemployment, consumer spending in Michigan held steady through 2020, and jumped up even higher this spring, aided both by increased employment and additional federal relief packages," they wrote. "And all this spending has helped jobs return swiftly."

One of the main reasons lawmakers voted to end the extra aid was because of the labor shortage occurring in Michigan. But Cooney and Shaefer argue that other factors are driving the shortage, like "continued fear of COVID, and, in particular, job and wage mismatch." They call on lawmakers to continue to support Michiganders until the economy has healed.

"This is not a good moment to pull billions of dollars out of the economy before it is necessary," they conclude. "Let that money continue to stabilize Michigan’s economy and Michigan households, as we seek to emerge from this pandemic in as strong a position as possible."

This op-ed was originally published in the Detroit Free Press. Read the entirety of the piece here.