Safety Net for the Unemployed; the good, the average and the ugly

No state invests more state dollars in the retraining of unemployed workers for the jobs of the future than Washington State. In the next fiscal year the state will be investing $38 million for starting and expanding community college programs in high demand fields like health care, aerospace and green energy - fields that even today have vacancies. More than 14,000 unemployed workers will be in training programs.

To help provide income support for these students, Washington state extends unemployment benefits for workers who are in retraining. Students can get unemployment benefits for a long enough time period to start and complete a two years occupational training programs. We are the only state in the country who has such a program.

Where we have lost some ground is how effective unemployment benefits have been in replacing the income they had in their previous job.

In the year 2000 workers who are unemployed in Washington on average were able to replace roughly 53% of their wages with unemployment benefits in 2000. At this point we were 7% above the national average. Today, we have fallen to 48% about a percent above the national average. The system in Washington state works better for low income workers. Workers earning less than $25,000 per year are able to retain nearly 2/3 of their income with unemployment insurance while those in the middle about 50%, those at the top 19%.

Where we truly have a problem is in the percentage of workers who are eligible for unemployment benefits. In 1994, over 55% of Washington workers who were unemployed were eligible for unemployment benefits, some 20% higher than the national average. Today, Washington has fallen to the national average of roughly 35%. Many people without jobs today simply get no benefits.

Here we may need to think this through a bit more. Many of these folks have ended up on welfare which has seen a 30% increase in caseloads. Others are facing a safety net that is being slashed in order to close our state budget deficit.