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  • downward Florida Unemployment: Florida Unemployment Insurance Under Attack

    The state of Florida is the state with the third highest unemployment rate in the United States. The state unemployment insurance coffers are empty and the government has already started borrowing from the federal unemployment insurance trust fund to cover current unemployment insurance benefits. In an effort to curve this trend and lower the burden of unemployment insurance on businesses and the state treasury the state has followed the lead of several other states and reduced the unemployment insurance entitlement of Florida unemployed workers.

    As of 2012 the maximum number of weeks of unemployment benefits available to Florida unemployed workers will no longer be 26 weeks as now, but 23 weeks. However, the Florida unemployment insurance program will not offer 23 weeks automatically, it will depend on the current unemployment rate. The idea is that during periods of low unemployment rate, unemployed workers receive less weeks of benefits than when the unemployment rate is high, because finding a job should be easier during periods of low unemployment than when unemployment is high.

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    For example, if the unemployment rate is 5 percent or less, the Florida Agency for Workforce Innovation will only pay 12 weeks of benefits. This reaction is a result of the hike in insurance taxes employers have suffered in the last three years. State projections estimated Florida employers would have to pay a minimum of $206.55 a year per worker in 2012, with this new bill companies will save up to $32.10 a year.

    As you would expect, reactions to this new bill are mixed. Businesses and supporting lawmakers point to this as a business-friendly measure that will attract businesses to Florida and reduces the tax burden of the unemployment program. Note that under the current bill unemployed workers will have to provide additional information and jump through more hoops to receive the same benefits.

    The reduction in state unemployment benefits also affects federal unemployment programs linked to the state unemployment program. For instance, the Extended Benefits program offers workers in high unemployment areas with up to 20 weeks of additional benefits. Yet, with the changes set by the new law, Extended Benefits weeks will no longer be available to workers because they are linked to the state program. In a nutshell, the new law will reduce the unemployment insurance benefits available to Florida workers will drop from a maximum of 99 weeks to 73 weeks. This could have serious consequences for long-term unemployed workers who struggle to find employment.  Florida is not alone in these tactics. Missouri and Michigan have gone further and reduced unemployment benefits to 20 weeks while Arkansas reduced unemployment benefits by one week.

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