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 In Economic Security, News Releases, Tax and Budget

FOR IMMEDIATE RELEASE
October 21, 2026

Contact:
Laura Millard Ross
lauramr@mlpp.org
517-281-1084

Affordability in Michigan requires boosting incomes, investing in families and avoiding tax cuts

Two new reports from the Michigan League for Public Policy lay out policies around wages, taxes to help families get ahead

LANSING – Four in 10 Michiganders are struggling to afford the basics, and two new reports from the Michigan League for Public Policy (MLPP) show that the problem goes far deeper than recent, dramatic price spikes. Released today, the reports note that Michigan’s affordability crisis is due in major part to decades of stagnant wages and tax choices that have shifted costs onto working families. The reports from policy analysts Patrick Schaefer and Nicholas Hess also provide policy recommendations for the state.

View the reports:
Treading Water: How to Reverse Decades of Stagnant Wages that Contributed to Michigan’s Affordability Crisis
Revenue Solutions for Michigan’s Affordability Crisis

“The affordability crisis is very real, and people feel it every time they pay rent or open a utility bill. It has hit so hard, too, because almost half of Michigan families have already been treading water for decades,” said Karen Holcomb-Merrill, acting president and CEO of the Michigan League for Public Policy. “The state can’t set the price of groceries and other necessities, but it can make sure workers are earning a living wage, and it can make sure Michiganders have the support they need.”

Wages haven’t kept up for decades. Treading Water finds that after adjusting for inflation, the median hourly wage in Michigan has grown just 3.87% since 1978. Meanwhile, wages for the top 10% of earners grew nearly 33%. Today, 26% of Michiganders are working but can’t afford basic needs, and another 13.4% live below the federal poverty line.

While the coming $15 minimum wage is a step in the right direction, it falls well short of what people really need. A single adult needs almost $26 an hour to reach financial stability, according to the United Way’s ALICE stability budget. Median rent rose 31.5% between 2019 and 2024, and center-based infant care now averages over $14,000 a year. Women and workers of color carry the heaviest burden, with women holding 60.5% of the state’s low-wage jobs and Black workers’ median wages actually falling since the 1980s when adjusted for inflation.

Tax cuts — and proposed tax cuts — have made things worse. Revenue Solutions reveals that taxes are not driving up costs and have been decreasing for decades. Michiganders pay less in state and local taxes as a share of their income than residents of 38 other states, and if Michigan collected taxes at the level it did 20 years ago, it would have more than $14 billion in additional revenue today.

Meanwhile, the top 1% of earners pay a lower effective tax rate than the bottom 20%.

“Tax cuts, especially during election seasons, are always sold as relief for regular people. But every time, the biggest ‘relief’ has gone to people at the top while regular families lose the services they count on,” said Holcomb-Merrill. “If we want to make Michigan affordable, we need to focus on supports that help those who are scraping to get by, not tax breaks for the wealthy.”

The report notes that public investments and cash benefit programs are a major part of families’ budgets, but with recent cuts to programs like Medicaid and the Supplemental Nutrition Assistance Program (SNAP), Michiganders in the bottom half of Michigan’s households will have even less to work with when it comes to affording what they need.

Together, the reports recommend that Michigan:

  • Set the minimum wage at a true living wage
  • Strengthen organizing rights by banning captive audience meetings, letting striking workers collect unemployment benefits and extending protections to agricultural and domestic workers
  • Create a fully refundable state Child Tax Credit and expand the Earned Income Tax Credit to young adults without children and Individual Taxpayer Identification Number (ITIN) filers
  • Raise childcare reimbursement rates and expand eligibility for the Child Care Scholarship
  • Ease household costs by passing water affordability legislation, expanding the housing supply, and protecting ratepayers from potential data center and infrastructure upgrade costs
  • Make the income tax more progressive either by repealing Michigan’s flat tax mandate or by adding a surtax on high earners, extending the sales tax to include services and tax wealth through an inheritance tax, and taxing based on net investment income
  • Give local governments the ability to raise revenue beyond the property tax

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The Michigan League for Public Policy, www.mlpp.org, is a nonprofit policy institute focused on opportunity for all. Its mission is to advance economic security, racial equity, health and well-being for all people in Michigan through policy change. It is the only state-level organization that addresses poverty in a comprehensive way. It is the home of Kids Count in Michigan.

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