Jobless people in six states to get fewer unemployment insurance checks

John Egan

Lawmakers in six states have reduced the maximum number of weeks that jobless workers can receive unemployment insurance benefits, according to a new report.

A report from the nonprofit National Employment Law Project indicates that in 2011, legislators in Arkansas, Florida, Illinois, Michigan, Missouri and South Carolina have dropped the maximum number of weeks for unemployment insurance below 26 — a threshold that had been the standard for all 50 states for more than 50 years.

Under new laws, some jobless residents of six states may have their unemployment insurance claims rejected.

Michigan, Missouri and South Carolina cut the maximum number of weeks to 20; Arkansas and Illinois went to 25; and Florida fell to between 12 and 23 weeks, depending on the state’s unemployment rate. Double-digit unemployment rates continue to plague Florida, Michigan and South Carolina.

“It’s disconcerting that these lawmakers would expend so much energy making cuts to state unemployment insurance programs when more people are out of work for longer than any other period on record,” Christine Owens, executive director of the National Employment Law Project, says in a news release. “Rather than adopting responsible financing practices and doing the hard work of fostering job creation, far too many state lawmakers have taken the easy out of cutting workers’ unemployment insurance benefits.”

In Florida, the change in the number of weeks of eligibility for unemployment insurance benefits will save an estimated $103 million a year, according to the state Agency for Workforce Innovation.

In June 2011, Florida Gov. Rick Scott signed a bill that he says is designed to enhance the “efficiency and accountability” of the state’s unemployment insurance program. Cynthia Lorenzo, executive director of the Agency for Workforce Innovation, says the unemployment insurance reforms will ease “the tax burden on employers to help them expand and create jobs.”

According to the National Employment Law Project, most states will require federal legislation to restore the financial health of their unemployment insurance programs, avoid sudden tax hikes on employers and maintain the unemployment insurance benefits for out-of-work Americans. President Obama included an unemployment insurance overhaul in his budget plan for fiscal 2012, and U.S. Sen. Dick Durbin, an Illinois Democrat, is sponsoring legislation that he says would solidify the finances of the U.S. unemployment insurance program.

As of Aug. 3, 2011, according to the U.S. Department of Labor, 27 states and the U.S. Virgin Islands owed more than $38.5 billion to the federal government for loans they took out to prop up their unemployment insurance initiatives. In September 2011, states must start paying interest on these loans. Beginning in 2012, the federal government will raise taxes on employers in borrowing states until the loans are paid off.