UI modernization may get more funding, oversight
In its 2022 budget, the Labor Department is asking for $100 million more to shore up state unemployment insurance systems and a check-and-balance system to ensure fixes happen.
To help states develop better technology to administer unemployment insurance, the Labor Department is asking for $100 million in fiscal year 2022 -- on top of the $2 billion already committed for UI modernization in the American Rescue Plan Act.
Labor Secretary Marty Walsh has been vocal about UI modernization since his nomination, noting that the antiquated systems in many states were unable to keep up with the flood of unemployment claims caused by the pandemic.
"These investments focus on deep needs … that have been clearly needed and often cruelly exposed by this pandemic, but they're not new," Walsh said during an April 28 House Appropriations subcommittee hearing devoted to the Labor Department budget. "God forbid we have a pandemic in the future.… We have to have a system that works for everyone."
The ongoing UI modernization issue “often feels like Groundhog Day -- where every single economic crisis, we have the same conversation about how broken our unemployment system is," Rep. Josh Harder (D-Calif.) said. "My question for you is how are we going to know if we fix it?"
Walsh replied: "One way you can tell if it's fixed is the way people are treated on unemployment. If they need unemployment benefits, they apply, they get them. And when they don't need them anymore they don’t get them." When he was mayor of Boston, he added, "I heard every single day about somebody waiting to get unemployment benefits."
Walsh also stressed the importance of oversight.
"We, the Department of Labor, need to put a process, a check and balance in place so that we can monitor these systems across the country to make sure they're working because, again, a $2 billion investment and then I think we're asking for another $100 million in this budget, that's a large investment to make in a UI system and get nothing back for it."
There's interest in Congress in making sure the UI funding works to improve state systems. Sen. Ron Wyden (D-Ore.) and Rep. Steven Horsford (D-Nev.) introduced a bill in February to overhaul UI technology by giving DOL funds to develop modular technology solutions to common UI problems – enrollment, eligibility, claims – that states can piece together to create modern systems. The bill's sponsors and other Democrats have encouraged Walsh to use their bill as a guide to spending the funds given in the American Rescue Plan.
This article was first posted to FCW, a sibling site to GCN.