Why some unemployed Michiganders don't want work

This shouldn't be surprising to anyone. People in Michigan on unemployment are turning down job offers so they can keep getting unemployment benefits.

Members of the Michigan Nursery and Landscape Association "have told me that they have a lot of people applying but that when they actually talk to them, it turns out that they're on unemployment and not looking for work," said Amy Frankmann, the group's executive director. "It is starting to make things difficult."

Chris Pompeo, vice president of operations for Landscape America in Warren, said he has had about a dozen offers declined. One applicant, who had eight weeks to go until his state unemployment benefits ran out, asked for a deferred start date.

Our government simply doesn't understand incentives. They've provided so many benefits for not working that for some people it makes little or no financial sense to get a job. Why get a job working 40 hours a week when you can get close to the equivalent for sitting at home?

The average landscape worker earns about $12 per hour, according to the Michigan Department of Labor and Economic Growth. A full-time landscaping employee would make $225 more a week working than from an unemployment check of $255.

But after federal and state taxes are deducted, a full-time landscaper would earn $350 a week, or $95 more than a jobless check. The gap could narrow further for those who worked at other higher-paying seasonal jobs, such as construction or roofing, which would result in a larger benefits check.

Here's a personal example. I own a rental property in which the prospective tenants receive Section 8. Section 8 is a housing voucher program where the federal government pays a portion of the rent for low-income families or individuals. For my prospective tenants, the government will pay more than 6/7 of their rent. The wife works part-time and the husband doesn't have a job. I have no doubts that they receive other government assistance as well like food stamps and utility bill assistance because I can't imagine how this family consistently makes their car payment (about 3 times their portion of rent) and survives without it.

But what happens if the husband was to get a job. If it's a low-level entry job then I don't see how his salary would offset the government benefits they could lose if their combined income reaches a certain level.

So what's his incentive to get a job? In the short-term there really is none. If he gets a job then he's not home to watch their children which means they'll need get some sort of childcare. They also might need to get a second car or rely on public transportation. If he gets a job then a large portion of their government assistance (rent, food, utilities, health care?) goes away.

Now maybe the net income from this job will more than offset the loses of government assistance but I don't think it would by much and certainly not enough to make it worth working 40 hours a week.