See the entire 2010
WSLC Legislative Report
Unemployment Insurance pumps $6.5B into state
But efforts to strengthen this safety net fail in 2010
So
this is what a jobless economic recovery looks like.
Washington’s unemployment rate remains near 10% -- higher in areas like Clark County where it’s near 15% -- and those rates ignore those who have given up looking for work or who have gone back to school. Some construction trades are reporting rates of 30% to 50%.
Thankfully, our state has one of the healthiest Unemployment Insurance Trust Funds in the country. Not only is it helping struggling families stave off bankruptcy and foreclosure, it is saving businesses and saving jobs.
In 2009, the system injected $4 billion in benefits into our state economy. This is the best kind of economic stimulus because that money immediately gets spent, circulating in local economies. The Department of Labor says that for every $1 of benefits, $1.64 of purchasing power is created. So in 2009, our U.I. system created $6.5 billion in economic activity across this state.
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BE CAREFUL WHAT YOU ASK FOR |
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Hey, business owners! Wondering why your unemployment insurance tax bills have gone up so much in 2010? The problem is the volatile tax system that business groups asked for and got in the 2003 deal to attract Boeing 787 assembly (or some of it). After this tax system was rammed through the Legislature, against labor’s objections, the 2003 WSLC Legislative Report predicted, "extreme volatility of rates is guaranteed. This will ensure continual pressure to further cut benefits when employers’ rates spike in weak economic conditions." (Who coulda seen that coming?) |
Last year’s temporary boost in U.I. benefits expired on Jan. 1, effectively cutting weekly benefits by $45 to $71. So the WSLC sought to mitigate this cut by supporting some modest expansions in U.I. eligibility so its benefits could reach more families and communities.
Rep. Steve Conway (D-Tacoma) and Sen. Jeanne Kohl-Welles (D-Seattle) sponsored HB 2647/SB 6526 to capture $98 million in federal U.I. modernization funds by extending eligibility to part-time workers and HB 2553/SB 6334 to allow workers forced to leave jobs due to "unreasonable hardship" to receive benefits. These changes would cost about $36 million a year from a U.I. Trust Fund with $2.5 billion and frontloaded the $98 million in benefits now when it’s desperately needed, creating $160 million in consumer spending in every corner of the state.
But neither bill got anywhere.
That’s because powerful business lobbying groups in Olympia consistently ignore the U.I. system’s benefits to their members and treat it merely as a tax -- one that’s gone up.
Despite last year’s passage of significant U.I. tax rate cuts, the amount many employers pay in taxes went up in 2010 because employers have laid off workers and our U.I. tax system -- designed by the business community itself in 2003 (see box above) -- is excessively experience-rated.
So, after succeeding in killing the aforementioned labor-supported bills, business groups sought another tax cut in the form of HB 2920. It failed as legislators looked to maintain the U.I. Trust Fund’s stability.
There are many, many more stories included in the print version of the WSLC's 2010 Legislative Report. See the Table of Contents. Also, members of WSLC-affiliated unions can request a free copy of the printed version of the report.
2010 Senate Voting Record -- 2010 House Voting Record
Copyright © 2010 Washington State Labor Council, AFL-CIO