(pleasant tonal music)
- [Narrator] As coronavirus closures
have put businesses on life support,
jobless claims have surged.
In some states, more than 20% of the workforce filed claims,
but in other states, the share is much lower,
and experts say the numbers may still underestimate
the scope of people who are out of work
trying to access the benefit.
- It's taking states a while to process benefits as is,
and to add in
the new Pandemic Unemployment Assistance benefit,
the $600 and the 13 additional weeks.
- [Narrator] Here are some of the obstacles
holding states up as they try to process
the historic number of unemployment claims.
(quietly tense orchestral music)
Challenge number one, technology.
In some states, old technology has slowed down the process.
In mid March, Connecticut residents began to overload
the state labor department's website with claims.
The portal could only handle
about 8000 benefit applications at a time.
Once the problem was resolved, claims increased sharply.
A spokesperson from Connecticut's Labor Department
said that before the spike in claims,
the state was already in the final stages
of moving to the cloud.
Connecticut is far from the only state
with technology issues.
The New York State Department of Labor
had to add computer servers to address the flood of claims.
The department's unemployment claims hotline
received 8.2 million calls in the last week of March
compared with 50,000 in a typical week.
The website recorded 3.4 million visits
compared with 350,000 normally.
- Only 16 states have upgraded off of their 1970s
COBOL mainframes entirely.
Then there are a few states
who've upgraded their benefits systems,
four states who've upgraded their benefits system,
three states have upgraded their tax system,
but for the most part, states are still running
on pretty old technology.
- [Narrator] Challenge number two, experience.
Some states also lack experience
in setting up the systems for the new unemployment funds.
According to Evermore, some elements
of the Pandemic Unemployment Assistance program
are based on the disaster program.
- Disaster unemployment assistance
has been around since 1974.
Some states are used to using the system.
States that have a lot of natural disasters
have implemented disaster unemployment assistance before,
states like Florida, Louisiana,
they get hit with a lot of hurricanes, the Carolinas, right,
Texas, but some states haven't had
a lot of natural disasters.
Arizona, for example,
hasn't had a natural disaster declaration since 1983,
and coincidentally, my colleague just found out
that they won't have their computers up and running
to process these benefits for 18 weeks.
- [Narrator] Challenge number three, financial pressure.
Some states, like Massachusetts,
are experiencing additional financial pressures.
The new federal unemployment programs
make up to 39 weeks of unemployment insurance
available to previously uncovered groups like gig workers.
The federal government pays an additional $600 per week
for each successful claim through July 31st,
but states are still on the hook
for standard unemployment payments.
Those payments range from $213 a week in Mississippi
to about $550 a week in Massachusetts.
- [Michelle] The average weekly benefit amount
in the United States is about $370 a week.
The average weekly wage in the United States is around $970,
so that $600 represents that gap to get workers to 100%.
- [Narrator] The standard benefits are paid
by state unemployment trust funds,
and some states have drawn down their trust fund balances
sharply between February and April.
For example, Massachusetts spent more than half
of its unemployment trust fund balance in that period.
A spokesman for the Massachusetts Labor Department
said the state is committed to making sure workers
continue to receive the benefits they deserve.
Several states have burned through their cash
and may seek additional loans
from the federal government to stay afloat.
More than 20 states aren't positioned to pay out enough
in unemployment benefits in the event of a recession
according to the Journal's analysis
of labor department data. (pleasant tonal music)