The idea is to harmonize varying states’ unemployment compensation benefits, offering base federal standards and automatically boosting benefits during economic contractions.
The bill would require weekly benefit amounts to replace 75% of a claimant’s average weekly earnings in the claimant’s highest quarter of earnings during a base period.
All of which would be useful for Ohio, according to a new report from Policy Matters Ohio, a left-leaning Ohio think tank.
“Nearly 600,000 Ohio workers would gain coverage under the strengthened UC (unemployment compensation) program,” Policy Matters Ohio said in its report. “Congress should include the plan in the budget reconciliation package now being considered or pass it as a stand-alone bill.”
Policy Matters Ohio finds several “gaps” in Ohio’s unemployment benefits coverage.
One is a “stringent” standard for how much a worker must earn just to qualify for benefits.
Ohio policymakers have set that minimum at 27.5% of the state average weekly wage, averaged over at least 20 weeks of work in a year, Policy Matters Ohio said. This year, that amounts to $280 a week, or at least $5,600 in earnings over 20 weeks.
Only Arizona, North Carolina and Washington state have a higher minimum amount than Ohio, the think tank said.
You can qualify for jobless benefits in Ohio if you’ve worked as little as 20 weeks, Shields said in an interview. But compared to other states, Ohio’s requirement is more stringent, he said.
Based on census survey data, Policy Matters Ohio estimates that 591,000 Ohio workers who wouldn’t currently qualify for benefits because they don’t meet the earnings test would be covered under the Brown-Wyden-Bennet amendment.
Ohio still has more than 260,000 fewer people employed today compared to before the pandemic (February 2020), Shields said. (New state figures are expected Friday.)
He rejects the idea that unemployment benefits dampen job searches. About four of five Ohioans who have received unemployment benefits have taken jobs before they exhausted their benefits, he said.
The Senate bill would require at least six months (or 26 weeks) for unemployment benefits, which Ohio and most states already provide.
Rea Hederman Jr., vice president of policy at the conservative-leaning Buckeye Institute, said the bill would create a new federal mandate, forcing some states to raise payroll taxes, particularly states that don’t offer a full 26 weeks of benefits.
For a state like Ohio, altering the earnings requirement would force Ohio businesses to pay more in taxes, Hederman said. Most of that burden would fall on workers, he added.
Further, he holds that when states pay people not to work, people in fact won’t work.
“If you take a look at the United States unemployment system, where most states have 26 weeks (of unemployment benefits), when you expand unemployment (benefits), when you have more generous benefits, you make people more reluctant to come back to work,” Hederman said.
He pointed to restaurants. Some offer drive-through-only service not because of mask mandates but because they don’t have enough workers to offer dining inside.
“I’ve seen that in Columbus,” he said. “There’s ample evidence, you can go restaurant to restaurant.”
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