Whitmer Unveils Michigan Economic Jumpstart Plan for Businesses, Workers
As the pandemic continues to wind down, the state of Michigan is still sitting on billions of federal dollars sent as relief.
Governor Gretchen Whitmer unveiled a plan Thursday to use much of it to jumpstart the Michigan economy.
“It’s been a long hard year but we are poised for great growth and we’ve got huge opportunity in front of us,” said Gov. Whitmer at a press conference for the Michigan economic Jumpstart Plan.
Whitmer’s plan aims to jumpstart the economy with programs and grants targeting three main buckets, as she calls them.
“One is higher wages. two is small businesses and then childcare,” said Whitmer.
The entire “Jumpstart” plan will cost just over $1 billion. Thanks to better—than-expected tax revenue and the federal relief payments, the state is expecting a $3.5 billion surplus from which this money will come.
Inside the plan are grants to subsidize wages to lift employee paychecks to $15-an-hour, grants to cover re-opening costs for businesses and expanding eligibility for low cost childcare.
One thing it won’t do, is cut expanded unemployment benefits. Alternatively it will allow workers to take part-time jobs and continue to collect. Questions arose due to incentivizing part-time work when full-time positions remain open.
“There’s an incentive in here for that as well. We are encouraging it,” said Whitmer, “We want to make sure that we are giving people all of the incentives to get back to work so that they can take care of themselves and their families. Then not forgo other opportunities that can help them get back on their feet.”
The legislature will still have to sign-off on these plans and, in the past, have said they are unwilling to spend one time dollars on long term plans.
Whitmer reiterates this isn’t long term, just a jumpstart.
“This is a six-month plan to raise wages and get people back into the workforce,” said Whitmer, “The market will drive what happens thereafter.”
Details of the plan are below:
GOVERNOR WHITMER’S ECONOMIC JUMPSTART PLAN
— BETTER PAYCHECKS —
Governor Whitmer put forward the MI Bigger Paychecks proposal and reinforced the need for postsecondary opportunities, like the Michigan Reconnect and Futures For Frontliners program. By bumping pay and increasing educational and skills opportunities for workers, the state can entice more people to get back into the workforce and increase our labor force participation rate.
- MI Bigger Paychecks: Governor Whitmer’s plan would utilize $300 million to encourage businesses to increase wages by offering grants to cover the difference between their current wage and $15 per hour. The grants would cover the first three months of this raise for workers if businesses commit to retain the employee and continue the $15-per-hour wage for at least three more months.
- Michigan Reconnect: Governor Whitmer’s plan would provide $120 million to build on the successful, bipartisan Michigan Reconnect program to ensure a pathway to a better-paying job through a tuition-free credential, certificate, or associate’s degree for anyone 25 years or older. The Michigan Reconnect has already accepted more than 70,000 Michiganders.
- Futures For Frontliners: Governor Whitmer’s plan would recognize the sacrifices frontline workers made through the pandemic to help keep the rest of the state going by providing them with tuition-free paths to earn a degree or certificate. The Futures For Frontliners program has already accepted more than 120,000 frontline Michigan workers.
— SMALL BUSINESSES —
Governor Whitmer unveiled the Michigan Mainstreet Initiative, a $300 million investment to uplift small businesses. The plan would include $100 million towards restaurants and other place-based businesses to help them cover costs and meet payroll; $125 million for small businesses left out of other incentives and organizations that support them; and $75 million in grants for startups.
- Michigan Small Business Restart Program: Governor Whitmer’s plan will invest $100 million to help restaurants and other place-based businesses cover costs by providing grants up to $20,000 for mortgage, rent, taxes, payroll, and other operating expenses. The plan will set aside $25 million for small businesses with less than 9 employees, which is over half of Michigan businesses and a high proportion of women and minority owned businesses.
- Michigan Microenterprise Support Initiative: Governor Whitmer’s plan would invest $125 million to provide grants for businesses that did not qualify or apply for other incentives, like the federal Paycheck Protection Program. The plan would work with community development financial institutions to provide loans to rural businesses or other businesses with less than nine employees that struggled to access capital through traditional programs.
- The Michigan Small Business SmartZones and Business Accelerator and Resiliency Initiative: Governor Whitmer’s plan would invest $75 million to provide grants to startups that can help our communities thrive. The plan would create the Small Business Support Network and Small Business Fund to support traditional commercial corridor/main street businesses and also provide opportunities for new businesses.
Lastly, Governor Whitmer is proposing expanding Michigan’s Work Share and hiring a surge of Unemployment Insurance Agency staff to help Michiganders fulfill their work search requirements. The Work Share program, which was a tool used by employers to avoid laying off workers, can be used by businesses to bring on new employees to help them restart. During the pandemic, Michigan’s work share program saved nearly 100,000 jobs. As the waiver on work search requirements for unemployment benefit recipients expires, Governor Whitmer is proposing hiring an additional 50 full-time staff to meet the expected surge in demand and help Michiganders fulfill their work search requirements.
— CHILD CARE —
In her executive budget recommendation, Governor Whitmer proposed a $370 million investment to expand access to no-cost or low-cost childcare for 150,000 more families. Right now, Michigan needs talent, and regardless of whether a child is 12 months or 12 years old, working parents can’t work without safe, quality, affordable child care. The governor’s plan would temporarily increase the income eligibility threshold from 150% to 200% of the federal poverty line, waive out-of-pocket copays through fiscal year 2022, and provide a 10 percent increase in hourly rates for child-care providers.