West Virginia’s unemployment fund is healthy, but its vital signs could take a bad turn as the nation’s economy slides, so a task force is working on ideas to head off potential trouble down the road.
As more people are thrown out of work in a widening recession, other states are finding it tough to keep abreast with unemployment compensation, but the Manchin administration says it is bracing for more claims.
“It’s OK right now,” policy director Lara Ramsburg said Monday.
“But if you were looking last week at the projections of unemployment, not only for our state but for the country over the next two years, that will have a significant strain on the fund as it has in other states.”
Even so, the West Virginia Chamber of Commerce is keeping its eyes trained warily on Manchin’s study group, prepared to resist any possible move that would hike the basic wage on which taxes are collected for the jobless fund from $8,000 to $12,000.
While it hasn’t directly lobbied the task force, Steve Roberts, president of the state Chamber, says he has turned over some “impressive facts” to Manchin’s staff and members of the Legislature.
“We’ve pointed out the fact that West Virginia’s basic wage rate is right in line with the other states, that our benefit levels are probably a little high when compared to other states,” Roberts said.
The Chamber understands the challenges in a shaky economy that could see the jobless ranks grow higher, Roberts said, but there remains “a lot of frustration” that strikers, workers taking early retirement, and drug abusers are dipping into the fund.
Roberts acknowledged the fund should remain solvent, “but we have to understand that challenge in the context that the fund currently has $250 million in it, or maybe a little less, now that we’ve paid some of it out.”
“And I think that would cause you to slow down a little bit and say, ‘Maybe it’s not so urgent that we raise the prices.”
Manchin set up a special task force late last year to produce recommendations it feels are needed to maintain solvency in the fund that gives workers checks when they are laid off from jobs.
“They have been meeting, but we don’t have final recommendations yet,” Ramsburg said.
“I expect we’ll have some recommendations on that soon.”
Business closings elsewhere are swelling the ranks of the unemployed in other states, leaving their ability to keep checks flowing to the suddenly jobless in doubt.
So far, the recession hasn’t imposed any such stress on West Virginia’s unemployment compensation fund, Ramsburg said.
“That’s why we started this process early, trying to be as responsible as possible and trying to make sure we were looking at this issue,” she said.
Roberts said he thinks the decision-makers are considering the information supplied by the Chamber.
“I think there is a fairly good chance they will slow down on this and try to take the time and get more information and really know more about it before they do anything about it,” the Chamber leader said.
— E-mail: mannix@register-herald.com
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