Michigan unemployment claims dart up amid automaker shortages

·2 min read

Jul. 22—Production slowdowns in the auto industry helped fuel an eye-popping surge in Michigan's weekly unemployment claims, the state Department of Labor and Economic Opportunity said Thursday.

The number of residents claiming unemployment in Michigan spiked from 7,465 to 20,548 between the second and third weeks of July, according to data from the U.S. Department of Labor. That 175% statewide increase is one of the highest in the nation.

Nearly 13,000 of those claims, or 63%, were in the automotive industry, said Erica Quealy, a spokesperson for the state labor department. And "almost of those were specifically related to auto manufacturing and auto wholesale trade," she added.

The department typically sees this trend when automakers slow down in summer months — a seasonal trend that typically has a notable effect on the state that houses significant operations of three of the world's largest automakers.

"Michigan historically sees a large increase in claims filed each summer as auto manufacturers and their suppliers temporarily shut down their plants and facilities," Quealy said.

On top of typical summer slowdowns, automakers have also taken hits due to a semiconductor shortage. General Motors Co. announced Wednesday that it plans to cancel production at one Indiana assembly plant and roll back schedules at the Flint Assembly plant next week due to the shortage.

Quealy said Michigan's Unemployment Insurance Agency "rigorously monitors any spikes in claims to protect against fraud, but there's no reason to believe these recent claims are out of the ordinary."

The jump in Michigan's jobless claims comes amid an uptick nationally. Total U.S. claims rose to 419,000 — the highest in two months — from 368,000 a week earlier.

Thursday's numbers come as the fight over enhanced unemployment benefits continues to play out in Lansing and Washington, D.C. Gov. Gretchen Whitmer vetoed a Republican proposal Tuesday that aimed for the state to relinquish the federal $300 unemployment bump.

Republican lawmakers claim the federal bump is keeping people from working, fueling a national worker shortage, while Democrats have argued that the added money is a needed support for people whose livelihoods have been impacted by the pandemic.

The federal unemployment bump is set to expire in September.

AHarring@detroitnews.com

Twitter: @alex_harring

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