A proposal by Gov. Scott Walker to change the rules regarding Wisconsin unemployment benefits should be given serious consideration by the Legislature.
The economic downturn and slow recovery has put a burden on the unemployment benefits safety net that has helped many Wisconsin families survive the past few years.
Increased unemployment claims drained the state’s jobless reserve funds and left it with a $1.2 billion deficit at the start of 2012.
The fund borrowed money from the federal government, and the state raised assessments on all Wisconsin employers who pay into the fund.
While the length of time that people can collect unemployment benefits has been reduced, people who file today still would be eligible for benefits for up to 63 weeks. Twenty-six weeks are under the state program, and the remaining time falls under emergency benefits recently revised and signed by President Barack Obama that remain in effect through the end of the year.
Unemployment benefits are designed to help bridge the gap between jobs for workers, who continue to receive some money while they seek a new job. The amount received is based on an income formula, but the maximum amount is $363 a week.
It’s a challenge finding work during a period of very slow job recovery, but there are some who cheat the system, perhaps because they have given up looking for work or somehow feel entitled to receive the money.
The Department of Workforce Development says in 2011 there were about 37,000 fraudulent unemployment claims in Wisconsin. In 2010 the state paid $37 million in fraudulent payments and $41.4 million in overpayment errors.
Among the changes proposed by Walker would be to require unemployed workers to complete four job applications a week instead of two and to require additional documentation to reduce fraud. The proposal also would restrict the reasons a person can refuse work for reasons such as illness, travel distance or physical restrictions.
The proposal also would narrow the list of exceptions for workers who quit a job and still receive unemployment. Wisconsin has 18 quit exemptions, higher than any other state in the Midwest. Minnesota is second with nine.
Walker’s proposals are part of a larger overhaul of state rules and regulations that are the result of direct feedback from businesses all over the state that were surveyed or invited to meet with state officials. Many are common-sense changes.
Wisconsin’s unemployment rules have traditionally been set by an advisory council of employers and unions. It’s important to get feedback from this council before proceeding with any of the changes.
We should all support rule changes that would reduce the amount of fraud and save businesses money. We all pay when people are dishonest.
But we encourage further discussion of unemployment benefits to allow more common-sense transition into the workforce. An unemployed worker working a few hours a week while training for a new job should not be penalized. Perhaps the amount of benefits should be front-loaded and reduced toward the end of the eligibility period to encourage people to find work sooner.
However, the real solution to the challenges of unemployment benefits is to have fewer people in the system — not through more restrictions but through more jobs. The governor and the Legislature must stay true to their word and put a top priority on legislation and policy that will boost the sluggish economy and put more people back to work.