Wallet Watch: Fixing Michigan’s unemployment agency’s past problems

The Michigan Unemployment Insurance Agency office in downtown Grand Rapids on Tuesday, Aug. 8, 2023. (Joel Bissell | MLive.com) Joel Bissell | MLive.com

Welcome back Wallet Watchers!

Let’s have a great start to the week with some of Michigan’s latest economy and business news.

Years after COVID-19 brought the world to a halt, the Michigan Unemployment Insurance Agency is working to make some organizational improvements. The pandemic exposed serious flaws within the system — some of which the state is still recovering from to this day.

Let’s follow the money and see where it goes (that one’s for you, Hamilton fans):

Michigan unemployment agency on mission to fix ‘99 problems’

Issues plagued the Michigan Unemployment Insurance Agency when Director Julia Dale took the helm in October 2021.

“There were any number of problems,” she said of the beleaguered department. “There’s the song that says ‘I have 99 problems.’”

A mountain of pandemic claims strained an aging computer system, billions were paid to fraud, a churn in leadership, lawmakers held blistering oversight committee hearings, a series of audits scrutinized the agency, two lawsuits are pending and an overpayment issue is ongoing.

But Dale wants to learn from the past.

As the 11th director in 11 years, Dale, a lawyer who previously worked for the attorney general, is on a mission to improve the Michigan Unemployment Insurance Agency into a “fast, fair and fraud-free service.” This means rebuilding trust with claimants, businesses, lawmakers and other stakeholders by overhauling the state agency.

“Our efforts in doing so are going to require a holistic approach to this transformation,” Dale said this week as she embarked on a listening tour of all 13 unemployment offices.

“That doesn’t just mean replacing the (information technology) system – which we are doing and we’re very excited about – but it also means looking at how we make decisions.”

More: Michigan unemployment agency on mission to fix ‘99 problems’

Ford accused of selling hybrids at risk of spontaneous fire

Six customers are suing Ford Motor Co. because they allege the company sold hybrid vehicles with faulty engines, leading to “catastrophic cars fires”, according to a lawsuit filed last week in U.S. District Court in Detroit.

The 124-page document claims the Michigan-based auto manufacturer “knew or should have known of the stall and fire risk prior to launching the vehicles” — 2020-2023 Ford Hybrid Escapes, 2022-2023 Ford Hybrid Mavericks and 2021-2023 Lincoln Hybrid Corsairs — and did not act to timely warn car owners.

The car models, which contain 2.5-leter hybrid electric vehicle and 2.5-liter plug-in electric vehicle engines, can suffer a “block breach,” according to the lawsuit. This occurs when the engine seizes and shatters the rods and connected bearings, which can thrust through the engine block or the oil pan, causing oil or fuel vapor leaks and pools where it is at risk of ignition, potentially causing spontaneous hood smoke or fires.

Warranty claims related to the fire risk were made to Ford as early as April 2021, the lawsuit said. It further alleges, although Ford issued recalls in March and July 2022 and reportedly developed a solution to prevent more fires, the company did not inspect the engines to decisively know which car had the defects to properly address the issue.

More: Ford accused of selling hybrids at risk of spontaneous fire

Michigan manufacturers are at a crossroads. What’s next?

A demo from Hyperion Automation at the Advanced Manufacturing Expo in downtown Grand Rapids on Wednesday, Aug. 9, 2023. (Photo by Rose White | MLive)

First came steam, second was electricity, then computers.

And now manufacturing, a cornerstone of Michigan’s economy, is in its fourth revolution: digitization. Industry advocates hope manufacturers embrace Industry 4.0 – a term used to describe this current era – to drive the $100 billion economic engine into the future.

“Manufacturing is at a crossroads,” Tom Kelly, CEO of Automation Alley, said while attending the Advanced Manufacturing Expo last week in downtown Grand Rapids.

Kelly, who has served as CEO since 2016, described this as an opportunistic time for Michigan’s 11,000 manufacturers but also one steeped in fear and risk.

“Fear manifests itself in a lot of different ways,” he said. “In manufacturing, how it manifests itself is by doing nothing.”

If manufacturers don’t get on board, it could spell disaster.

From auto supplies to aerospace, manufacturing has an outsized impact on the Michigan economy, accounting for 18% of the gross domestic product compared to 12% nationally. Although the number of jobs have dropped since 2000, manufacturing still employs 608,000 people in Michigan or 13% of the nonfarm workforce.

More: Michigan manufacturers are at a crossroads. What’s next?

24 Michigan agricultural projects get funding to improve food supply

The Michigan Department of Agriculture and Rural Development distributed $1.8 million in grants to two dozen agricultural businesses and organizations to improve supply chains and address food insecurity.

The funding awarded Monday, Aug. 7 will support agricultural processing across Michigan through investments in technology, equipment, feasibility studies, healthy food access, regional food systems and urban agriculture, a news release said.

“These investments highlight the unique opportunities available to our local food and agriculture businesses while allowing companies to increase capacity, secure supply chains, and implement climate-smart practices. With Governor Whitmer’s leadership, we’re ensuring Michigan is an essential destination for our food and agriculture industry,” said Michigan Department of Agriculture and Rural Development Director Tim Boring in a statement.

The state received 109 proposals overall with requests totaling more than $8.6 million.

More: 24 Michigan agricultural projects get funding to improve food supply

Interested in more economy news? Check out all our coverage of how the economy impacts people in Michigan here.

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Wallet Watch: Fixing Michigan’s unemployment agency’s past problems