By Arthur J. Rosenberg

Florida has a tremendous opportunity to boost its economy and help thousands of unemployed workers stay afloat as they look for their next job.

More than 1 million of our residents are now unemployed. Our neighbors, our friends, and their families are struggling everyday to cover necessities like housing, health care, and food. Unemployment compensation (UC) is a necessary tool to help them and our state get back on its feet.

As a result of the Federal American Recovery and Reinvestment Act (ARRA), Florida could receive $444 million in federal funding to pay for unemployment benefits. For Florida to get this sorely needed money, the legislature needs to modernize our UC system and mend holes in our UC safety net.

Last session, our elected state officials had an historic opportunity to do what is right for the families hardest hit by unemployment by helping to boost local economies and reforming our unemployment system to meet the challenges of the 21st Century. Yet, they rejected this much needed stimulus money as well as the opportunity to update our system to help deserving workers when they lose their jobs.

Florida now faces an unemployment rate of close to 12 percent, one of the highest in the nation. It is Florida’s highest rate in decades. Our UC trust fund has been depleted by the huge rise in claims, and we are borrowing $250 million each month from the federal government to pay benefits. Now, more than ever, the infusion of significant federal funding could go a long way to help address the system's funding woes and at the same time provide UC benefits to over 60,000 unemployed Floridians.

But our UC system needs more than a simple infusion of cash: It needs serious reform. At present, only a fraction of Florida’s unemployed are eligible to collect benefits. In prior recessions, workers who lost their jobs knew they could at least count on unemployment benefits to help them get by for a time. Now only 31 percent of our state’s jobless are able to access unemployment benefits, 48th lowest in the nation.

Many of the remaining workers fall through the cracks of the unemployment system because of outdated eligibility rules that fail to count their most recent work. This historical anachronism, left over from a time when it took months to add up and transmit a worker’s wages from handwritten records to a distant state agency, today subsists in an era of instantaneous computer calculation and electronic transmissions. The result often prevents low-wage workers and those in high-turnover fields from getting UC while they look for another job. As a result, hard working families are far too often found ineligible for unemployment benefits. Thirty-five states have adopted laws over the past year to modernize their system and in doing so will be able to receive their share of federal funds. More states are poised to do so in their upcoming legislative sessions.

Florida is again considering proposals that could modernize our UC system and mend holes in the unemployment safety net – which was designed for the workforce of the 1930’s. Rather than excluding thousands of unemployed workers from receiving benefits, these proposals would provide a lifeline for low wage earners, victims of domestic violence, and workers who have to leave their jobs to care for a sick family member, or who have to follow a spouse who has relocated. If approved, Florida would receive an infusion of $444 million, and thousands of deserving unemployed Floridians would become eligible for benefits that would keep them out of poverty during these hard economic times. These federal funds would cover the cost of their benefits for at least four years.

Unemployment benefits put money into local economies as recipients spend their funds on basic needs like food, housing, transportation and consumer goods. Once spent, this money re-circulates in the market, contributing $1.64 in economic growth for every $1 of UC awarded, allowing the $444 million to generate $728 million in our communities.

Our state leaders now have a tremendous opportunity to get relief to thousands of unemployed workers presently slipping through the safety net, to boost our economy, and thereby get thousands of residents back to work. Adopting these unemployment reforms will help Florida out of the recession and put our state on track to building a first-class unemployment program to serve the future needs of all working Floridians and the businesses that employ them.
Rosenberg is an attorney with Florida Legal Services.
Copyright (C) 2010 by the Florida Forum. 3/10