Note that Georgia, which is considered business friendly, has had a higher unemployment rate than the national average, every month for at least the last 50 months, more than four years.
I would bet ALEC was active in pushing for this.
http://unemployedworkers.org/sites/unemployedworkers/index.php/site/blog_entry/race_to_the_bottom_georgia_legislators_approve_severe_cuts_to_ui
Posted by: Mitchell Hirsch on Apr 04, 2012
Workers who are laid off after July 1 in Georgia will face the grim prospect of having their already-meager unemployment insurance benefits drastically curtailed.
In the waning minutes of its 2012 session, Georgia’s state legislature last week approved a bill (HB 347) that slashes state unemployment insurance (UI) from the standard 26 weeks to a maximum of 20 weeks, and would further reduce the maximum to as few as 14 weeks depending on Georgia’s unemployment rate. That rate now stands at 9.1 percent, with Georgia tied for the seventh highest rate among the states. Fifty Georgia counties – nearly a third of the state’s total – had average unemployment rates of 12 percent or higher last year. The average duration of unemployment nationally is a near-record 40 weeks, but at most, future jobless workers in Georgia will only be able to receive half of those weeks in regular state benefits.
Georgia joins Michigan, Missouri and South Carolina in reducing to 20 the maximum weeks of state benefits, and Florida, which last year adopted a sliding scale scheme of 12-to-23 weeks. Georgia’s cuts, the most severe in the nation, take effect for new unemployment claimants beginning July 1.
The bill was pushed through at the behest of the chief business groups in the state led by the Georgia Chamber of Commerce, Georgia Association of Manufacturers and the National Federation of Independent Business. Lobbyists for the business groups, and their allies in the legislature, devised the scheme of harsh benefit cuts to avoid paying higher taxes and to shift most of the burden for repaying Georgia’s unemployment insurance loans onto jobless workers.
Under the plan, which Governor Nathan Deal is expected to sign, employers will see tiny increases in their unemployment insurance taxes. According to Atlanta attorney Elizabeth Appley, a worker advocate, 40 percent of Georgia employers will see about a 38 cent tax increase per employee next year. Unemployed workers, on the other hand, will see their potential benefits reduced by hundreds, often thousands of dollars – when they can least afford it.
It’s not like Georgia employers are paying high UI taxes already. Between 30 and 40 percent of them have been paying just $2.87 per employee a year. And Georgia ranked 47th among the states with an average UI tax rate on total wages of only 0.55 percent in 2011. The chart below shows that Georgia's UI tax rates tracked substantially below the national average during the last two decades.
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At the same time, for jobless workers, Georgia’s unemployment benefits program has long ranked at or near the bottom – even before the impact of the newly-enacted cuts – with an average weekly benefit of only $268. And relatively few jobless Georgians find they even qualify for benefits. With only 23 percent of unemployed workers receiving state UI benefits last year, Georgia’s recipiency rate ranked 37th in the nation. The chart below shows that Georgia’s UI recipiency rate has tracked well below the national average.
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Georgia also has the stingiest benefit formula in the country for determining weeks of benefit eligibility. The average jobless Georgia worker was able to collect only 13 weeks of UI in 2011, the lowest average duration of all states. This is not because Georgia workers are finding work faster than in other states. In fact, more than half of all unemployed Georgians exhaust their state UI benefits without finding a job. Georgia’s low 13-week average duration is largely due to the state law that restricts benefits to no more than one quarter of the wages the worker earned in the prior year. In every other state, benefits available to unemployed workers are a larger percent of their prior earnings. Georgia workers with low earnings prior to layoff had not been receiving the previous maximum 26 weeks of benefits; and now, neither will any other laid-off workers, no matter how high their prior earnings.
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the root cause of the state’s UI fund insolvency and debt is the long-standing under-funding of the program.
That under-funding was made even worse at the start of the last decade when Georgia businesses were given a $1.3 billion tax cut courtesy of a four-year “tax holiday” – the largest unemployment tax cut in U.S. history. In addition, the state suppressed an automatic surcharge on tax rates needed to replenish the low trust fund balance every year since 2003.
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As for those unemployed who Pruett says are not “dramatically hurt” by Georgia’s UI cuts, he asserts:
“And when the maximum goes to 20 weeks, they can get federal benefits after that, up to 73 weeks."
Well, that may have been what Rep. Pruett and his colleagues were told by business lobbyists, and it would be nice were it true – but it’s not.
The federal benefits extensions available to workers who exhaust regular state benefits expire under current law at the end of December of this year. Most Georgia workers who are laid off after July 1 this year – and who would only be eligible for a maximum of 20 weeks of state benefits under the new state law – would have no federal benefits available to them under current federal law. Only a fraction would exhaust their maximum 20 weeks in time to qualify for, at most, six weeks of federal benefits before the end of the year. And even if Congress renews the federal UI extensions, Georgia’s unemployed would be eligible for fewer of those weeks because they are based on a percentage of available state weeks of benefits.
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Senator Richard Durbin, a Democrat of Illinois, has sensible legislation that would forgive federal loans for states that rebuild their trust funds over several years. It has languished in the face of Republican opposition and Democratic unwillingness to force a debate and a vote on the issue.
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