MI Unemployment Fund out of $$

excitedtobemrs

Local 4 has learned Michigan?s unemployment trust fund is out of cash.

Each year, the first $9,000 you make brings a tax on your employer to pay unemployment benefits.

Nearly a quarter million Michigan companies pay into the fund and in a good year, it adds up to about $1.5 billion half dollars.

When a company?s layoffs exceed taxes paid they?re known as negative balance employers.

Right now, Michigan has 33,000 negative balance employers.

Michigan Department of Labor and Economic Growth Director Stephen Geskey calls it a rainy day fund.

"Our difficulty now is that we have been a little too long, a little too hard, and we didn't save quite enough for this rainy day and that's why we're in the situation we are in."

The state unemployment fund went broke in 2006.

For the past two years, Michigan borrowed from the federal government to keep paying the state?s growing demand for unemployment benefits.

Right now, the state is using half a billion federal dollars and the federal government expects that money to be paid back.

Geskey admits he?ll need millions more if thousands of job cuts come from a possible General Motors Chrysler merger.

In order to re-pay the loans, the state will raise taxes on the negative balance employers, starting in January. It amounts to about $68 per employee.

The state will also raise unemployment taxes on businesses laying off the most employees to take care of the loan balance.

A similar situation happened in the 1980?s, when the auto industry was struggling.

katie277s

Welcome to Michigan! 

KoriBrett

f*cking wonderful.  I live where Pfizer is.  They just made another round of cuts, too. 

Lets go get wasted, shall we? gads.  I'll meet you in AnnArbor.

excitedtobemrs

AA it is, Kori.  I'm totally in.

Just shows how bad it's been in MI and for how long.  It's freaking awful here!

PiperBride

That whole situation makes me sad for the state.  The economy, the people, the morale...it's so tough. 

UBMyBaby

That is not good.  And it makes me mad to see people not buying American made vehicles.  I know so many auto workers who have been laid off and are losing their homes.  And to think that the American people are putting them in that position by not buying American.  Ick.