Paid leave is affordable, sustainable

A version of this column originally appeared in The Alpena News.

For well over a year now, bills to enact a statewide paid family and medical leave program have been sitting in the Michigan Legislature with not so much as a committee hearing. This is despite the facts that it’s the right thing to do for Michigan workers and families, it has garnered support from the majority of Michiganders, and it has been shown to be a low-cost, high-value program according to a recent actuarial analysis commissioned by the state.  

The actuarial analysis, released last month by the Michigan Department of Labor and Economic Opportunity, is the latest in a growing amount of evidence that shows that the time is now for paid leave in Michigan. Whether it be needing time to bond with a new child, caring for an aging parent, recovering from a serious medical procedure or taking care of a loved one at the end of their life, we all have times when stepping away from work for longer than a few days is necessary, and all workers deserve to be able to do that without sacrificing their livelihood.

The recent actuarial analysis shows that providing this kind of compassionate and very necessary support to workers and families would not only be affordable, but also stable and sustainable. The most expensive program option explored in the analysis would provide 15 weeks of paid family and medical leave (including leave to care for a loved one during a public emergency) and 10 days of bereavement leave for the death of a family member each year at a beginning overall contribution rate of 0.76% of employee wages—the cost of which would be split by employers and employees. Small businesses with under 25 employees would be exempt from payment; however, their employees would still be part of the program and would only be required to pay half of the contribution rate. This would ensure that small businesses that want to do right by their employees, but cannot afford to provide paid leave, are able to offer the same benefits as larger companies, ultimately making them more competitive in hiring and retaining talented workers.

Based on the contribution rate for the program option detailed above, a full-time worker making Michigan’s median salary ($46,940 a year) could expect to contribute $3.43 weekly—the same as buying a 20-ounce Starbucks coffee once per week. And a full-time worker making minimum wage ($21,486.40 a year) could expect to contribute $1.57 weekly—less than buying a 20-ounce bottle of soda per week. As for employers, a business with 50 full-time employees, each earning the state’s median wage, could expect to contribute a total of $8,918.60 a year to cover all of their employees.

The program would, in turn, provide workers with benefits they all need and deserve, including: paid medical leave for a worker’s own or a loved one’s serious health needs, paid family leave for bonding with newborn children or children placed in adoptive or foster care, paid leave for exigencies that arise when a family member is called to military duty (up to 26 weeks for this benefit), paid safe leave in situations involving domestic violence, paid bereavement leave for the death of a family member and paid leave to care for a loved one during a public emergency.

Another important thing to note is that the actuarial study focuses solely on the cost of implementing a paid leave program and not on the very real costs of not implementing a program. 

The costs of inaction regarding paid leave in Michigan have resulted in wage and job losses for workers and families, worse health outcomes, higher healthcare costs, talent losses for businesses, and a negative impact on the state economy. Investing in a state paid leave program would accomplish the opposite, including higher workforce participation and earnings, better health outcomes, improved employee morale and retention for businesses, and an economy that will continue to grow. It would certainly help in creating more economic security for families and mitigating child poverty, which has a statewide percent of 17.8%. 

Our state policymakers should not delay any longer in keeping Michigan from joining the 13 other states (plus D.C.) that have already passed paid family and medical leave laws. A recent poll presented by Progress Michigan shows that 71% of Michiganders support paid leave and Gov. Gretchen Whitmer identified it as one of her top legislative priorities last fall. Now that we have the numbers that show that a paid leave program is affordable and sustainable for Michigan, it’s high time to make it a reality.