Michigan's Minimum Wage Unlikely To Increase

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Michigan’s minimum wage will not be increasing, as it was planned to do on New Year’s Day.

“While Michigan’s October unemployment rate continued its downward trend and is 5.5 percent, the annual average from January through October currently sits at 10.2 percent and is highly unlikely to dip below the 8.5 percent threshold when the Bureau of Labor Statistics releases the final 2020 unemployment numbers for Michigan,” Camara Lewis, a Communications Manager at the Department of Labor & Economic Opportunity said.

While the Improved Workforce Opportunity Wage Act of 2018 allowed the current $9.65 an hour full rate to increase, it did have a provision where it has to be delayed a year if the unemployment rate goes above 8.5 percent. The Michigan Department of Labor & Economic Opportunity said in a press release that while the Mitten State started out with unemployment well bellow that rate, at 5.5 percent at the start of this year, the recession brought on by the coronavirus has almost doubled that rate to 10.2 percent.

Until it does, Michigan’s full unemployment rate will stay $9.65 an hour for adults, $8.20 an hour for 16- and 17-year olds, $3.67 an hour for tipped employees, and $4.25 an hour for trainee employees between the ages of 16 and 19; according to the department.

It is of course impossible to see what will happen in the next year, or how the economy will respond to the roll out to the vaccines that were recently approved by the Food and Drug Administration. While it is widely presumed that the economy will improve dramatically once normal interactions can happen again, predictions on how and when that might happen range wildly from one observer to the next.

Washtenaw County Treasurer Catherine McClary did not support the delay. While not an economist, the former investment banker advocated for a living wage instead.

“A recession means that we don’t have the productivity we want to have,” McClary said.

McClary added that low interest rates would be the real determiner of keeping inflation and the cost of living down.

Chambers of Commerce contacted for this article all either declined comment, or could not be reached.

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