A layoff may be imminent. Is unemployment insurance ready?

Back in the early days of the pandemic, the United States’ federal unemployment agencies tried real stress — and they didn’t succeed. The old computer system broke down, people couldn’t call to ask questions or get more information about their programs and in many states there were delays in maintenance.

Some states would still face claims and pending claims from 2020 and 2021, when unemployment programs were in place that increased eligibility and weekly benefits.

A strong labor market over the past year, with low unemployment and few layoffs, has given governments a break in dealing with the new claims, which fell to all time low 166,000 in March. But with the economy slowing and unemployment rising, initial jobless claims have grown by 50% since early spring – to 260,000. in the week that ended on Saturday. And the Federal Reserve is predicting that unemployment will soon rise again.

So, how prepared is the economy for an increase in unemployment?

There is good news for unemployment insurance, or UI, systems across the country, he said Andrew Stettnerdirector of staff policy at the Century Foundation.

“The Biden administration, they’re going to try to act quickly,” he said, “trying to identify business strategies that will slow things down, try it.[ing] for the nations to fix them.”

He said some countries have implemented technical reforms, but they won’t start until the mid-2020s. “We may have a financial crisis before these new programs begin.”

Congress gave the Department of Labor $2 billion in emergency funding through the American Rescue Plan Act of 2021 to help states upgrade their unemployment programs.

“We’ve sent teams of experts now to 24 different countries,” said Michele Evermore, deputy director of policy in the Labor Department’s office of UI modernization. “They get into the system, they understand the barriers to paying benefits on time, paying benefits equally. We’ve also given $140 million to states to fight fraud, which will help us a lot in the next crisis.

Pennsylvania has already changed its unemployment insurance technology, he said Julia Simon-Michel, managing attorney in the workers’ compensation division at Philadelphia Legal Assistance. Simon-Mishel also serves as chairman of the board unemployment insurance group to the National Academy of Social Insurance.

“Things are moving faster than they were during the pandemic,” he said. “Unfortunately, it’s a very low bar.”

He said the new system “targets people to want to use the Internet and social networking sites to do anything related to their interests,” from requesting information renewals to happy denials.

“While I’m sure there’s some work to be done for the organization – because these technologies are designed for organizations – unfortunately, they’re not designed or built by claimants or employers.”

The new system creates barriers for low-income workers and immigrants, who may not have Internet access or English skills, Simon-Mishel said. “For many of the people we see, they’re still struggling to navigate the system, to deal with new technology, and it’s very difficult to reach out to the Department of Labor and Industry and get answers.”

Currently, there is a shortage of workers in unemployment agencies across the country, said the Evermore Department of Labor.

“They have been working more and more now for several years. They endure a lot of insults in their work. So we have lost many insurance workers out of work. ”

Like Always he said congress meeting last week: “The turnover has been too high, it also reduces the capacity. Unless we have money to support the staff and the systems, it will not be effective in dealing with the next problem.”

Even if countries have solved their labor problems with technology, there are significant differences between them when it comes to who workers should receive benefits, how much they earn per week and how long they can receive benefits before they are no longer eligible.

“This outbreak exposed long-standing problems in the UI,” he said Jenna Gerry, senior staff attorney at the National Employment Law Project. “It’s leaving a lot of workers, especially Black and working-class women, out of work at all.”

That’s because many states ban part-time workers, temporary workers, low-income workers in the past and independent contractors. And countries have been reducing the period of benefit, Mr. Gerry said – which in the whole country was 26 weeks from the start of the epidemic.

“We have 13 countries that now offer less than 26 weeks, and offer benefits as little as 12 weeks.”

States have also been reducing eligibility by tightening job search requirements, for example, said Stettner of the Century Foundation.

“Less than three out of 10 unemployed people are getting a paycheck,” Stettner said, referring to the “interest rate” in Labor Department datawhich was 28% in the first quarter of 2022. The reception was twice the growth of the epidemic – boosted by federal epidemic programs – and about 50% back in 1980.

In some states, such as Louisiana, New Hampshire and Florida, the number of recipients in the first quarter of this year was below 15%. This percentage was at or below 10% in Tennessee, Alabama, Mississippi and North Carolina.

Average weekly profit The rates also vary widely and are not increased by the global pandemic payments, which range from $300 to $600 per week in 2020 and 2021. In the first phase, the highest benefits were paid in Massachusetts, Washington, New Jersey, Hawaii and North Dakota. The lowest benefits were awarded in Puerto Rico, Louisiana, Mississippi, Arizona and Tennessee.

Finally, despite the latest technology reforms, many people who file are still waiting a long time for benefits to start flowing, said Simon-Mishel of Philadelphia Legal Assistance.

“People are not being paid right now during the most important time – which is the first two months after someone is out of a job, the first time rent payments come after they stop receiving wages,” he said.

According to UI data dashboard published by the Century Foundation, the federal standard is that state programs confirm eligibility for UI on 80% of claims within three weeks. Only six states – Oregon, Utah, Wyoming, Nebraska, Minnesota and South Carolina – currently meet this standard.

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