OLYMPIA, March 22.—The Employment Security Department official Monthly Employment Report puts the news this way: “The seasonally adjusted unemployment rate dipped to an estimated 8.2 percent in February, down from a revised rate of 8.4 percent in January. It was the lowest unemployment rate since January 2009, when it was 7.7 percent.“
Employment growth was led by the hospitality and construction industries and more than offset job losses led by government and manufacturing.
As a result of the continuing decrease in state unemployment rates, beginning in April, six weeks of the 53 weeks of federal emergency benefits will expire, as well as all 20 weeks of normal extended benefits. As federal triggers kick in, the maximum number of weeks of benefits for the unemployed are expected to drop from the current 99 weeks to 73 weeks by the end of April. In September the maximum will fall again to 63 weeks, and finally to the basic 26 weeks beginning in January.
Meanwhile, the latest data shows that 76,103 workers have already exhausted their unemployment benefits since December 2009. A 4th Quarter 2011 Employment Security Department follow-up analysis of these claimants state records found that only 30% had found employment (the study could not track workers who retired or found work in other states).
According to ESD Deputy Commissioner Joel Sacks, reemployed claimants were earning 50 percent less in wages. The department is working to improve existing reemployment programs and implement new federal requirements, some of which are questionable exercises, like the requirement for a new reemployment and eligibility assessment, a program which loses federal funding soon after it gets off the ground.
From a financial perspective, the unemployment insurance system is doing very well, perhaps too well, with the trust fund currently at over $2.5 billion. This is the largest reserve in the nation, according to the department. Nonetheless Sacks says employers that have laid off workers will probably drive a very small overall tax increase in 2013. Washington’s increase will be nothing like the increases which are likely in most states, which have run up huge deficits and now interest charges during the Great Recession.
As usual, it is important to emphasize that with unemployment insurance, determinations regarding benefit duration reductions and tax rate increases are all driven by statutory formulas. The department does not have discretion in these areas, and future federal or state legislative changes could change any projection.