Home > Uncategorized > How to Help the Newly Unemployed: State has come far; federal reform needed 1/11/09 Concord Monitor

How to Help the Newly Unemployed: State has come far; federal reform needed 1/11/09 Concord Monitor

Back when I was in law school 25 years ago, my professor, the late Bruce Friedman, used to say things about the state’s Department of Employment Security that were unprintable in a family newspaper. Bruce was not exactly a fan. The department was harsh on workers, including many clients he represented.
In that era, New Hampshire typically had the lowest unemployment benefit recipiency rate of any state in the country. Only a small number of potentially eligible workers collected unemployment insurance benefits. New Hampshire workers also received among the lowest weekly benefits for the shortest duration of any state.
If I could use one word to sum up the unemployment system in New Hampshire back then, that word would be mean. The department did not make it easy for workers to collect. A head-in-the-sand mentality at the top promoted a program that was impervious to change. Protecting the unemployment trust fund translated into an agency with a culture of denial.
While there are still some vestiges of this culture alive and well, the good news is that Employment Security has come a long way from the bad old days. Under the leadership of Commissioner Richard Brothers and Deputy Commissioner Darrell Gates, the department broke the longstanding inertia and recognized the necessity for change. To his credit, Brothers supported long-overdue reforms that raised benefit levels and broadened coverage.
Instead of being dead last in the nation as far as generosity to workers, New Hampshire’s program is now more respectably in the middle of the pack compared with other states. These changes could not have come at a more fortuitous time.
According to the Labor Department, unemployment has hit a 26-year high nationally. Since January 2008, the nation’s employers have cut jobs every month, chopping 2.4 million positions this year. In New Hampshire, 5,680 workers filed initial unemployment claims in October. This is more than 2,000 more than filed in October 2007.
As a first line of defense for workers, the quality of the unemployment system matters tremendously. In a national poll conducted in November 2008 by Hart Research, 77 percent of workers who were receiving unemployment benefits reported that these benefits were very important to their ability to support their families with most
benefits spent on food and housing. Significant percentages of unemployed workers polled also had problems with economic issues like phone service cutoff, utility disconnects, interruption of education or training and payment for basic groceries.
Stepping back, it is a good time to reassess the adequacy of the unemployment system. We are facing the worst economy since the Great Depression. Unemployment has been neglected at the federal level by the Bush administration. Although little discussed or recognized, for eight years the needs of American workers were rendered invisible and disregarded as Bush and Cheney focused on their Iraq obsession. This neglect is another failure of conservatism.
Two types of reform
There are two immediate priorities for reform at the federal level. First, expanding the program of Extended Unemployment Compensation should be looked at. In light of the miserable economy, there is a need for further debate about how many weeks of unemployment benefits are appropriate. A feature of the current recession is increased long-term joblessness compared with other economic downturns.
Second, passage of the Unemployment Insurance Modernization Act should be a No. 1 priority. This bipartisan, revenue-neutral federal legislation would provide $7 billion to states which close major gaps in their unemployment programs. The unemployment system has a long history of failing to serve women, low-wage and part-time workers.
Benefit to New Hampshire
In New Hampshire, we still have a very low unemployment benefit recipiency rate. Only 31 percent of potentially eligible claimants collect.
The great thing about the Unemployment Insurance Modernization Act is that New Hampshire is perfectly positioned to reap the maximum benefit should it pass.
Because of reforms already passed in our Legislature, New Hampshire would be eligible for a $33 million infusion in our trust fund, plus an additional $2.3 million administrative allocation. This money would provide a timely boost to protect solvency since our unemployment trust fund has dipped below $200 million.
In considering any future economic stimulus plan, a good question to ask is how the proposal would affect the average working person. By that criteria, unemployment reform is worthy. It promptly puts money into the pockets of the unemployed, an act that will help to minimize some suffering in economically distressed households.

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