Right-to-work repeal could make Michigan’s job slump worse

Thirty-four states have fully recovered from the job loss they suffered during the pandemic and pandemic-related shutdowns, but Michigan is not one of them. The recent repeal of the state’s right-to-work law is likely to make that situation worse.

Following Gov. Gretchen Whitmer’s COVID shutdowns, the state’s job recovery record has been ninth-worst among the states. The net number of jobs here is still 33,100, or 0.7%, below its pre-pandemic level.

The state saw a steep rise in employment from May through November of 2020, when the governor slowly began allowing businesses to reopen. The number of jobs dipped again from November 2020 to January 2021, when Whitmer once again limited gatherings and shut down many businesses.

Michigan’s economy has been adding jobs since January 2021, with the slowest growth coming between July 2022 and January 2023. From February 2022 to February 2023, the state added 91,700 job, a 2.1% increase. The seasonally adjusted unemployment rate for the United States was 3.6% in February 2023, but the rate in Michigan was 4.3% for the third straight month.

The unemployment rate could worsen with the repeal of right-to-work, according to a study published in April 2022.

Michael LaFaive, senior director of the Morey Fiscal Policy Initiative at the Mackinac Center for Public Policy, and Todd Nesbit, assistant professor of free enterprise and entrepreneurial economics at Ball State University, measured the impact of right-to-work laws in various states.

LaFaive and Nesbit collected employment data from 18 industrial sectors of the economy. The study found that counties had higher employment levels in several industries, as a percentage of total private employment, in jurisdictions that had right-to-work laws in 2018.

“Counties in non-right-to-work states that bordered right-to-work states often had substantially lower employment levels than their nearby counties over the border in right-to-work states,” the study found.