As reported in December of 2024, legislation increasing unemployment insurance benefits and expanding benefit weeks, vehemently opposed by NFIB, (see more HERE) passed and was signed into law by Governor Whitmer as Public Act 173 of 2024 and became effective on April 2, 2025.

This legislation increases the maximum weekly benefit from $362 to $445 in 2025.  In 2026, it will increase to $530 and then to $614 in 2027. Benefits will increase each following year according to the Consumer Price Index from the US Bureau of Labor Statistics. Additionally, the legislation expanded benefits from 20 to 26 weeks and increased the dependent allowance.

Because tax rates have already been set for 2025, employers won’t see any increases in 2025 but will likely find that their tax rates will increase starting in 2026 to fund the expansion of benefits.

According to the Unemployment Insurance Agency, contributing employers charged the maximum tax rate of 10.3% in 2025 could see an estimated increase of 1.9% in 2026 taxes in their 2026 tax rates for the chargeable benefit component (CBC).

The increase in benefits could also cause the Unemployment Insurance Trust Fund to fall below $2.5 Billion which will trigger an increase in the taxable wage base from $9000 to $9500.

Michigan’s unemployment tax system is one of the most highly “experience rated” systems in the country. This generally means an employer’s tax is more closely based on the actual benefit charges to its account, and the size of payroll. To brush up on how benefits paid to employers could affect that experience rating, go to Michigan.gov/UIA for detailed explanations of the components that go into figure an employer’s tax rate.

NFIB will continue to fight these benefit increases and demand the UIA hold claimants accountable to seek and accept jobs rather than continue to receive benefits.