Final job numbers for 2018 are in

Jake has the details, and they are not pretty.

Job growth Dec 2017 - Dec 2018, QCEW
U.S. +1.5%
Mich +1.04%
Minn +0.91%
Ind. +0.88%
Wis. +0.60% <--
Ohio +0.549%
Iowa +0.547%
Ill. +0.31%

For 2018, the mid-west was well behind the rest of the nation. Only Michigan, with the money for auto manufacturing being pumped into that state, broke 1% job growth.

National headlines about a strong economy simply do NOT apply to Wisconsin, Ohio, Iowa, and Illinois.

Finally, Jake has the final job numbers for Gov. Walker during his time in office

All job growth, Dec 2010 - Dec 2018
Minn +319,619
Wis. +222,260

In 2010, Minnesota had fewer people and fewer jobs than Wisconsin. By the end of 2018, Minnesota surpassed Wisconsin in both categories. Wisconsin’s austerity put a brake on growth while a focus on middle-class growth and investment paid dividends in Minnesota, allowing that state to take the lead over Wisconsin.

Jake also has some information about current trends in manufacturing growth, and the news is NOT good.

Manufacturing and GDP, 2007-2018

This information, when combined with information from UW economist Menzie Chinn, indicates that manufacturing in the mid-west is already in decline. As Jake sums up this bad news:

the 2016-type slowdowns in manufacturing and the Midwestern economy as a whole are starting all over again. Except now we have a higher US budget deficit, with less room for upside as unemployment is likely as low as it can get, and more trade restrictions and adjustments are coming in the near future. Ruh roh.

Strangely, now seven days later, there are still absolutely NO reports in mainstream media about these job numbers or economic trends.

Here is the news that I could find when searching for “qcew wisconsin job numbers” that have to do with jobs:

If anything, further job cuts will compound the decline in jobs that seems already underway.

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Marketplace reports on how difficult unemployment has become

The Marketplace radio show had an excellent feature on May 10th about the changes to unemployment that have occurred since the great recession:

Note: Hat tip to Democurmudgen for this story.

As with Andrew Stettner’s examination of this issue, the focus here is mostly on legal changes to shorten or reduce benefit eligibility.

But, as also obvious in the Marketplace piece, many states have, like Wisconsin, simply made it that much harder to even claim unemployment benefits in the first place. For instance, here are a few of the barriers that now exist in Wisconsin to filing an unemployment claim:

On-line only claims-filing

  • In rural Wisconsin (and even suburban Wisconsin), on-line access is limited and mostly phone-based. So, folks need to fill in numerous forms and detailed information by pecking away on their phone keyboards.
  • The on-line system is English-only.

Job registration

  • Claimants MUST create a job-seeking profile on the https://jobcenterofwisconsin.com/ website.
  • As part of this process, an English-only survey needs to be completed.
  • As part of this process, a resume needs to be created. But, that resume needs to be typed in. Uploading a PDF of a resume is NOT allowed. Copying and pasting of resume sections is a possibility for some.

Attending job training events

  • Claimants must travel and attend a seminar about searching for work that features the https://jobcenterofwisconsin.com website.
  • Claimants must also travel and meet with a DWD jobs counselor about their job search efforts.
  • For more than half of Wisconsin’s population, these trips require a drive of an hour or more.

In a state where broadband access to the Internet is universally acknowledged as limited, the barriers listed here are substantial. It is through these barriers that the state discourages folks from even applying in the first place.

To those that say these barriers are an exaggeration, please then point out all the efforts the Department has undertaken to advertise and explain this on-line filing process, to make it more accessible and easier to understand, and to remove the barriers to access (by having job counselors travel to claimants, for instance, rather than the other way around).

I’m waiting.

The state of the unemployment trust fund and employer taxes

The January 2019 news about declining employer taxes was stellar. The May 2019 financial report reveals that the trust fund is in even better shape: nearly $1.9 billion as of April 30th.

Note: of course, benefit payments continue their decline, dropping 6.7% from 2018 numbers to $330.9 million as of April 2019. Employer taxes are also down $23.9 million, to $330.9 million, for January to April 2019.

At the May 22nd meeting of the Advisory Council, there was a presentation on the health of the unemployment trust fund. An excellent chart in this presentation presents the current situation:

Financial outlook p.4 graph -- benefits, taxes, and trust fund balance

As evident here, the trust fund is at a near record high while claimants’ benefits and employers’ taxes are dropping like rocks down the proverbial well. Two charts showcase how benefits and taxes have markedly declined since 2011 (benefits) and 2012 (taxes) relative to total payroll in the state.

Financial outlook p.6 graph -- benefits as a percentage of payroll

Financial outlook p.7 graph -- taxes as a percentage of payroll

So, what Wisconsin has experienced the last eight to nine years is ahistorical — only around 37% of claimants applying for unemployment benefits end up receiving any benefits rather than the more typical 55% of applicants.

Note: Department personnel continue to remark about how benefit payments are at record lows without offering any explanations or theories for why these record low benefit payments are occurring. As noted in this blog, this problem of record-low benefit payments is not unique to Wisconsin. But, it does seem from this same note that changes in how states are administering their unemployment law disqualifications are responsible for much if not all of this decline. Shouldn’t the Department finally take ownership of its own culpability for what has been going on the last eight to nine years or at least explain why the legal changes and administrative practices adopted under the prior governor to make it more difficult to claim unemployment benefits are somehow NOT connected to this decline in unemployment benefits?

At a minimum, Department staffers need to read Andrew Stettner’s excellent analysis of state unemployment systems and the changes in eligibility standards and application rates describes the impact of these changes and why these changes should be re-examined and most likely reversed.

To understand how healthy the unemployment trust fund actually is, three different scenarios for the future were played out in this presentation.

  • In one scenario, the economy continues along its current course, benefit payments remain anemic, and the unemployment rate returns to the normal 4-5% for Wisconsin. Here, the trust fund continues to be robust in the short-term. But, growth of the fund eventually slows, and the fund begins to decline slightly in the long-term.
  • In the second scenario, the economy continues along its current course, but benefit payments return to the historical experience of Wisconsin. While no recession is assumed to take place, the trust fund balance starts to take a hit in 2020 and a switch to the more aggressive tax schedule C will be needed by 2026 or so.
  • In the third scenario, a mild recession in 2020 occurs. Even with the anemic level of benefit payments continuing — 37% — the bottom of the trust fund drops out such that less than $500 million is left in the fund by 2022. And, in the long-term, the most aggressive tax schedule — Schedule A — needs to be triggered to start pumping money back into the trust fund.

In other words, these scenarios indicate that the trust fund balance — despite being at record levels — is wholly inadequate given the current size and scope of Wisconsin’s economy. Only a Pollyanna desire for the economic equivalent of sunshine and rainbows to continue indefinitely keeps the unemployment trust fund from imploding.

The current fetish with minimizing employers’ taxes is just one culprit behind this carefree thinking. Economists have begun explaining, that there is no correlation whatsoever between employers’ tax rates and business success. What remains to be seen is what the Advisory Council will do about all these problems: keep current policies and administrative practices in place or begin the process of changing these policies and practices. As many of these simply relate to the Department’s bureaucratic preferences in how it administers unemployment law (and, in numerous places represents a sharp conflict with that law), there is much that can be done immediately to correct at least the unparalleled decline in benefit payments before we find ourselves in the middle of a recession and with no oar available to avoid the waterfall towards which we race.

Low unemployment rates and low unemployment benefits — record lows for a reason

Mark Sommerhauser’s article about possible changes to criminal prosecution of unemployment fraud has a remarkable chart detailing the roller coaster plunge in unemployment benefits in Wisconsin since the end of the great recession.

UI benefits chart

In 2018, only $1.11 million in first-week unemployment benefits were paid out in Wisconsin. Here are some numbers to provide some perspective on this decline in unemployment benefits.

Historical comparisons

At the January 2019 Advisory Council meeting, the financial report included some jaw-dropping numbers regarding the stellar decline in unemployment taxes employers pay and the even steeper drop in unemployment benefits being paid to claimants. Tom McHugh explained during his presentation that benefit payments in 2018 had not been this low prior to 1994.

So, a comparison between the years 2018 and 1994 seems in order. Monthly claims history data reveal:

| Year | Init. claims | Benefits paid |
| 1994 | 430,452      | $405,625,564  |
| 2018 | 283,398      | $397,746,075  |

So, while the amounts of benefits paid are relatively close — a difference of around $8 million — there is a difference of 147,000 initial claims between the two years. These numbers mean that in 2018 the Department paid on average $1403 in unemployment benefits for each initial claim, whereas in 1994 the Department paid on average $942 in unemployment benefits for each initial claim that year.

In part, the lower number in 1994 exists because the maximum weekly benefit that year was only $243, whereas in 2018 the maximum possible weekly benefit rate was $370.

But, this data also includes information about the weeks being claimed versus the weeks that are actually compensated.

| Year | Weeks claimed | Weeks compens. | Prct. |
| 1994 | 2,589,895     | 2,443,988      | 94.4% |
| 2018 | 1,659,861     | 1,352,076      | 81.5% |

In 2018, just over 81% of the weeks being claimed were leading to actual payment of unemployment benefits, whereas in 1994 fully 94.4% of initial claims led to the payment of unemployment benefits.

The available weekly claims data for these years adds another eye-popping wrinkle to this comparison: the size of the labor force.

| Year | Init. claims | Covered emply. |
| 1994 | 452,526      | 2,301,412      |
| 2018 | 279,912      | 2,817,338      |

Note: changes in the number of initial claims being filed likely exist because of what is being measured: weekly versus monthly claims data.

So, in 2018 there was a drop of nearly 62% in initial claims from 1994 even through the number of covered employees actually increased by more than 500,000. If eligibility for unemployment benefits was the same in 2018 as it was in 1994, there should obviously have been more unemployment claims given the 500,000 employee increase in the eligible labor force. But, rather than an increase in claims in 2018 there has instead been sharp dive in unemployment claims.

Someone might argue that the workforce in Wisconsin has substantially changed from 1994 to 2018. That explanation does not hold much water.

Union sector comparison

This chart shows that there have been slight declines in manufacturing from 1994 to 2017 in Wisconsin as a percentage of the workforce (from 25.44% of the workforce to 21.21% of the workforce) as well as in public sector employment (15.06% to 12.84% of the workforce). But, the real changes have not been so much in the makeup of the workforce so much as in the percentage of who belongs to a union. Only private construction has NOT seen a dramatic drop in both union coverage and union membership from 1994 to 2017. And, those drops are by half or more from what existed in 1994. So, the decline in unionization is at least strongly correlated with the decline in Wisconsin employees receiving unemployment benefits in this state.

Fraud comparisons

The other major factor at play with the decline in unemployment benefits is the increased prosecution by the Department for alleging fraud.

As the Department’s fraud allegations are a relatively new phenomena (while unemployment fraud has always existed as a category, prosecutions did not begin in earnest until this last recession), this data cannot provide a look back all the to 1994. But, this data does reveal what the Department has been doing since 2011.

Initial claims and fraud cases by year

Here, the number of fraud cases as a percentage of total initial claims actually increased in 2013 and 2014, declined in 2015 and 2016, and has held steady at 1.67% of total initial claims in 2017 and 2018.

The over-payments being assessed as percentage of benefits being paid out, however, actually increased slightly in 2018, going from 1.11% of all unemployment benefits paid out in 2017 to 1.18% in 2018.

over-payments assessed by year

The decline in collections in 2018 from 2017 was more sizable, dropping from 3.14% of all benefits paid out to 2.58% of all unemployment benefits paid out in 2018.

over-payments collected by year

Noticeably, the collection of over-payments allegedly connected to fraud were in 2018 still more numerous than collections for non-fraud over-payments. Only in 2011, the first year of the Walker administration, was the ratio of fraud to non-fraud over-payment collections well below 100% (at 55.51% that year).

What’s next?

This month, the Department announced that unemployment rates are at a record low of 2.8%. As Jake has described these numbers, this low unemployment rate masks significant job losses in Wisconsin. Wisconsin is trailing the rest of the mid-west in job growth (and the mid-west itself as a region is trailing the rest of the nation in job growth).

The 1994 numbers described above indicate that while the state’s economy has not actually changed all that much from what existed in 1994, the unemployment system itself has markedly change. Even with a maximum weekly benefit rate in 2018 that is $127 higher than what existed in 1994, total unemployment benefits being paid out are about the same in 2018 in absolute dollars (i.e., NOT adjusted for inflation), 24 years later. This stagnation is shocking.

The big change with unemployment during the last eight years or so is the expansive and aggressive charging of unemployment fraud by the Department for accidental claim-filing mistakes. The case law is now over-flowing with decisions about how the Department has charged claimants with fraud for accidental claim-filing mistakes, defended those charges despite all evidence to the contrary, and even sought retribution against those who dared challenge the Department’s wishes on this front.

And, it is obvious to anyone filing unemployment benefits today about how complicated and difficult the claims-filing process has become. It is now all too easy for someone to make an accidental mistake during their weekly claim certification and then find themselves facing charges for unemployment concealment simply for not understanding what is being asked.

Note: this confusion and resulting mistakes ares even more likely when language and technology barriers are considered. Unemployment claims are on-line only now and STILL only in available English.

Finally, the decline in union representation and coverage from 1994 to 2018 indicates that the institutions that could have raised alarms and fought back against these changes to the unemployment system today lack the strength and support to conduct such a fight. As a result, these fundamental and far-reaching changes to the unemployment system have occurred without significant challenges.

A possible change on the UI fraud vendetta?

Mark Sommerhauser had an article this past Sunday for the Wisconsin State Journal about the push started by the prior administration for charging fraud against claimants for their non-intentional, claim-filing mistakes.

Not surprisingly, the former unemployment administrator, Joe Handrick, talked up how claimant fraud cases were, according to him, always legitimate.

Handrick said he fears those efforts could lose momentum under a provision of Evers’ plan for the next state budget, which calls for eliminating the one-week waiting period. Handrick said the waiting period was crucial in enabling state officials to catch fraudulent applications.

Handrick also rejects claims that some people prosecuted for fraud only made mistakes, saying the department long has distinguished between intentional and inadvertent omissions by claimants that lead to benefit over-payments.

“The things that get assigned as fraud are where the person clearly and intentionally attempts to defraud the people of the state of Wisconsin,” Handrick said. “Only the worst of the worst get referred to district attorneys for prosecution.”

There are two major problems with this statement.

First, the waiting week has absolutely nothing to do with alleged fraud investigations. The waiting week originally existed as a mechanism for delaying payment of unemployment benefits because of administrative difficulties in processing unemployment claims. Since the 1980s, however, that delay has no longer been needed, and now a waiting week’s only purpose is to reduce the unemployment benefits that are paid out. See Avoiding Waiting Weeks, “Unemployment Insurance Policy Advocate’s Toolkit” at 56-7.

This claim about waiting weeks is even more surprising in light of the Department’s obvious delays in investigating claim-filing mistakes. Indeed, the Department has gone out of its way to delay investigations and efforts into claim-filing mistakes so as to make the amounts at issue larger when the Department finally gets around to examining alleged mistakes. Furthermore, while other states have instituted practices that actually match claim-filing information with employer’s withholding tax reporting, Wisconsin has refused to implement such an obvious mechanism for catching claim-filing mistakes quickly. See my discussion of Massachusetts and New Mexico in Findings of the unemployment audit (17 Dec. 2014). The Commission as well has observed that the Department’s concealment efforts do NOT prevent improper payments from occurring in the first place and has noted that the Department’s concealment investigations often lead to exceptionally long and unwarranted delays in benefit payments.

Second, Mr. Handrick is ignoring the hundreds of cases in which the Department has alleged fraud for UNintentional claim-filing mistakes. There is a reason, after all, for why the Department wanted the Commission eliminated in the last budget cycle. See LIRC’s elimination (1 March 2017). In 2014, only 20% of the Department’s concealment charges that were appealed ended up being affirmed. This evidence indicates that only one out of every five of the Department’s concealment charges are actually based on intentional acts of claimants.

Note: recent cases that have come to my attention indicate that the Department’s appetite for alleging concealment has only increased over the years. See Thoreson v. Thor’s Wolverine Den LLC, UI Hearing Nos. 18401886MD and 18401885MD (22 Mar. 2019) (claimant who helped brother tend bar for no pay does not have to repay any unemployment benefits and certainly not the $25,000 in alleged concealment charged by the Department because claimant did no work for brother).

In other words, there is a gigantic gap between Handrick’s statements about rampant unemployment fraud and the reality of folks being confused and making accidental mistakes when attempting to navigate a hostile and opaque claim-filing system. No one should be taking Handrick’s statement’s at face value. Luckily, the new Department secretary, Caleb Frostman, indicates in the State Journal article that he wants to make the unemployment claim-filing process friendlier to claimants. Here’s hoping he and the Department get to work on this goal. And soon.

Advisory Council meeting — 17 Jan. 2019

After a break for the November elections, the Advisory Council met on January 17th to meet the new secretary, Caleb Frostman, and review events of the last few months.

The financial report was eye-popping and will be addressed in its own post. Here is what was covered outside of the financial report.

Mis-classification of employees

Mike Myszewski reported on the Department’s efforts in preventing the mis-classification of employees.

Note: These reports continue to be made orally and have NEVER appeared in writing. Given the Department’s annual report on alleged claimant fraud and the numerous charts and reports on alleged claimant fraud that appear at these meetings, it begs the question why the Department cannot at a minimum put down on paper in some way what it is doing to combat alleged employer unemployment fraud.

In any case, given that this report consists entirely of what was said, some of my numbers may be off. In addition, the exact nature and scope of this data is unknown, as this data is simply not available to the public and the Advisory Council apparently does not ask for it.

Mr. Myszewski reports that the Department has recovered $2.1 million in unemployment taxes from employers because of mis-classification for 1222 employees, or about $347 per mis-classified employee.

This recovery arose from 511 investigations in the last fiscal year, and there had been 145 investigations so far in the current fiscal year.

There were NO questions from the Advisory Council about this report.

The 15 Nov. 2018 public hearing

As compared to the public hearing in November 2016 in which there were 300+ comments from 295 individuals, at the 2018 public hearing there were only 21 comments in toto. Given these few comments, the summary presented to the council at this meeting included not only a summary but the actual 21 comments that were made.

Not surprisingly, work search waivers were again the hot topic. Here are some of those work search comments as well as others:

Karen, HR manager

“Moving onto the standpoint of someone who worked for UI, I think that customer service should be more of a priority for claimants and employers alike, but especially claimants. I get that there are some people that play the system, but overall, the claimants are not the enemy. The poor customer service is evidenced by the outrageous wait times when claimants call in, (but the employer hotline is answered in a couple of rings), not being clear on the number to call to get assistance, not posting the adjudication centers’ phone numbers or street addresses, and the legalese that is not easily understood by the average person in documents (which would not present as much of a problem if the claimants could easily contact someone who could help explain it to them).”

Krista, claimant

“[After describing various education and training actions that should count as job searches:] I understand that the State wants people off UI and back onto to work as soon as possible, but sometimes education and building of new skills are needed before people can do that. Just because it isn’t an application to a job, it does not make these actions any less of a job search function.”

Anonymous

“[After requesting that property liens that the Department uses for its debt collection efforts no longer be visible to the public via court records, she explains:] I have my Masters degree in Business. I have an undergraduate degree in Nursing. The ridiculous time consuming hoops I jump through to ‘prove’ I’m looking for a job are ridiculous. $370/wk doesn’t cover my bills and no one is looking harder for my job than me. As opposed to making people sit in some 4 hour class — where I can assure you that people like myself who have been working since 14 will get nothing from it.”

United Migrant Opportunity Services

“Over 11,000 claimants were accused of concealment in 2014. When appealed, over 70% were overturned, and another 8% remanded, It would appear that the Department is alleging concealment in many cases where a more thorough review of the evidence does not support that finding.”

Scott, building services employer

Unemployment benefits should be limited to 4 to 8 weeks. [Note: Currently, claimants are eligible for up to 26 weeks of benefits, and winter usually lasts a minimum of 14-18 weeks for those who go through seasonal layoffs.]

Tawana, claimant

She is upset with: (1) having to wait 21 days for an adjudicator to be assigned to her case and (2) the extremely limited access to phone support when the number of unemployment claims are much less than what occurred in 2010, when she last filed for unemployment benefits.

Soraya, claimant

Upset with having to wait 21 days for a decision on her claim.

Sarabi, claimant

The penalties for unemployment concealment are much too harsh.

Robin, claimant

Get rid of work search requirements for employees who experience seasonal layoffs and return to the same employer and eliminate the waiting week.

Sandy, claimant

Get rid of work search requirements for employees who experience seasonal layoffs.

Kyle, claimant

Get rid of work search requirements for employees who experience seasonal layoffs.

Tasha, employer

Get rid of work search requirements for employees who experience seasonal layoffs. And, the claim-filing process is extremely difficult for the employees handling snow removal during the winter months.

Bill, employer

Get rid of work search requirements for employees who experience seasonal layoffs. For employers in Northern Wisconsin, work searches during winter months are a waste of time for both employees and employers, as there no jobs available then.

Deborah, employee

End the ban on unemployment benefits for those who are working while also receiving SSDI benefits. [Note: the Department currently eliminates unemployment benefits because these claimants have a disability that qualifies them for SSDI benefits. Wisconsin is the only state to have instituted this ban. Other states have only applied an offset to unemployment benefits for the SSDI benefits being received.]

Nadine, employer

Get rid of work search requirements for employees who experience seasonal layoffs and return to the same employer. She explains: “Our seasonal employees are returning to our business which they have been at for several years!! Why take the chance with this job-search stuff, which we could lose our valuable employee that we rely on returning. Now days’ finding someone to work is very hard.”

Richard, employee

Get rid of work search requirements for employees who experience seasonal layoffs and expect to return to the same employer year-in and year-out,

Avis, claimant

Complaining about being denied benefits because a medical disability limits work availability. *Note: the description offered presents an obvious violation, as claimants are still eligible for unemployment benefits when work availability is limited to part-time work only because of a medical condition. See CITE.

Hawks Quindel law firm

Undo the damage to the unemployment system created in DWD v. LIRC (Beres), 2018 WI 77, 382 Wis.2d 611, 914 N.W.2d 625, that allows an employer to discharge an employee for a single absence (regardless of why the employee was absent) as misconduct and end the work search requirements for employees who undergo seasonal layoffs and expect to return to the same employer.

Heidi

After presenting numerous ways to make job search information more user-friendly to claimants, she requests that job search criteria be expanded to include the actions claimants actually need to undertake when searching for a new job — such as networking events and informational interviews — and for the Department to allow training opportunities that currently prevent claimants from receiving any unemployment benefits.

Lame duck legal changes

The Department included a one-page memorandum regarding the lame duck changes enacted via 2017 Wis. Act 370. The last sentence of the memo provides all the description that is needed:

Because Act 370 codified current administrative rules and Department practices, claimants and employers should not expect any changes to the unemployment insurance program under this Act.

So, Republican legislators have taken ownership of the job search requirements that nearly no one — I repeat, nearly no one, if the public comments in 2016 and again in 2018 are any indication — thinks are doing anything useful except to make unemployment claims more difficult. Everyone in rural Wisconsin should be asking their state representative and senator why — WHY — they think these job search requirements make sense.

Next steps

The Department indicated that its own proposed changes to unemployment law will be introduced at the February meeting of the Advisory Council (why the Department continues to introduce its own substantive changes to unemployment law remains a mystery ever since the Department proposed its own substantive changes to unemployment law in November 2012).

Scott Manley of Wisconsin Manufacturers & Commerce also made two research requests. First, he wanted the Department to revisit its definition of independent contractor work in light of growing employment through TaskRabbit, Mechanical Turk, and other on-line business operations.

Note: the Labor and Industry Review Commission has already determined that a Lyft driver is NOT an employee for the purpose of unemployment benefits. See Ebenhoe v. Lyft, Inc., UI Hearing No.16002409MD (20 Jan. 2017). Currently, Lyft’s responsibility for paying unemployment taxes is being litigated. See Lyft, Inc., UI Hearing Nos. S1500424MW and S1800091MW (26 Oct. 2018).

Second, Mr. Manley wanted to know what the Department could do to expand its program integrity efforts for bringing criminal charges against claimants for their alleged unemployment fraud. For how the criminal charges that have already been filed are hugely disproportionate according to the race of claimants (75% of the cases are against African-Americans), see this post.

Mark Reihl of the Carpenters made a third request. He wanted a comparison of how Wisconsin’s weekly benefit rate (the average received and the maximum available) compare to the other fifty states and territories.

Note: Wisconsin’s maximum available weekly benefit rate is $370. The average weekly benefit being paid out in 2017 was $317.14. See this 2017 4Q report (this data is for all fifty states, Wisconsin is on p.64 of the pdf). Data for the 3Q of 2018 indicates that the average for the last four quarters was $320.03. The average duration of unemployment benefits for these last four quarters was 12.7 weeks. See p.63 of the pdf for this data.

Data on the financing for all fifty states for 2017 (the most recent year available) can be found here (Wisconsin is on p.60 of the pdf).

Unemployment benefits for federal workers during the shutdown

The Department of Workforce Development released the following notice yesterday:

Wisconsin ready to assist furloughed federal employees
Workers can access unemployment funds during partial shutdown

MADISON — Federal employees in Wisconsin can apply for unemployment benefits to help meet their financial needs while they wait for work to resume.

“We are ready to assist any federal employee that is facing a lack of work and income due to the partial shutdown,” said Department of Workforce Development Secretary Caleb Frostman. “Furloughed federal workers are dislocated workers, unemployed through no fault of their own and can apply for unemployment.”

Federal employees can apply for unemployment through DWD’s online UI benefit system at my.unemployment.wisconsin.gov.

Because many federal offices are currently closed, furloughed workers should be prepared to provide wage verification in the form of pay stubs or a W-2 form as DWD may be unable to verify wages through the employer.

Federal workers that are working full time but are not being paid during the partial shutdown are not eligible for unemployment benefits.

There are more than 29,000 federal employees in Wisconsin. Per preliminary counts, DWD’s unemployment division fielded roughly 426 total initial and continued unemployment compensation claims between Jan. 7 and Jan. 11, 2019.

As required by law, workers who receive back pay should plan to repay any unemployment benefits received.

Several issues need pointing out, however.

First, federal workers are finding it difficult to impossible to actually file unemployment claims. On-line claims (the only method allowed for filing an unemployment claim) are being rejected without an explanation that the worker understands. And, phone calls to get an explanation are limited to certain days of the week, and those days are connected to a worker’s social security number. Miss that day, and you have to wait several other days or maybe even a week to try again with a phone call.

Note: For example, after two minutes of voice menu choices and prompts, I learn that I need to call back on Monday, Wednesday, or Friday, as Tuesday is not my designated day according to my social security number if I want to ask someone a question about the claims-filing process.

Second, the on-line claims process (the last time I had access) does not contain a category for govt shutdown. These workers are not laid off. They have not been discharged either or let go for performance-related reasons. They could indicate that they are locked out, but I do not think that reporting category exists. And, the kind of questions being asked can lead to claims being summarily rejected. For instance, a federal worker could easily report he or she is still eligible for work with his or her federal agency. Answering yes to such a question would automatically mean no eligibility for unemployment benefits because the separation seems to be a voluntary quit by the employee.

Third, given the Department’s eagerness to charge concealment for non-intentional claim-filing mistakes (including in 2018 alleged mistakes in reporting the reasons for the employee’s separation from employment). So, an employee might indicate he or she is laid off and start collecting benefits because of the shutdown. The Department may later conclude, however, that this layoff “reason” is incorrect and then charge the claimant with unemployment fraud for intentionally providing misleading information on his or her unemployment claim (and even when the mistake was actually unintentional).

Note: for a full description of the unemployment concealment issue, see this expert report I prepared for a case of a claimant charged criminally for the kind of unemployment concealment allegations that the Labor and Industry Review Commission routinely dismisses.

Fourth, any federal workers with second jobs, while still eligible for unemployment benefits, MUST make sure to report wages and hours from those second jobs. Under-reporting those numbers will automatically be considered by the Department to be fraudulent. So, any wages or hours from a second job should be OVER-reported to avoid a fraud charge down the road.

Fifth, you will need to do four job searches a week and many other tasks to remain eligible for unemployment benefits. For how to handle those job searches and other unemployment filing matters, make sure to review these tips for filing unemployment claims in Wisconsin.

Finally, when/if the shutdown ends and if/when missing wages are repaid, you will need to immediately contact the Department about re-paying unemployment benefits. If you wait for the Department to contact you, expect to be charged for unemployment concealment.

So, as repeatedly said here, unemployment is purposefully difficult to impossible to receive and everyone should avoid unemployment benefits unless you have no other options. The on-line system is designed for the benefit of the Department — not you — as a way to catch a mistake on your part. As obvious, these hoops and obstacles for filing unemployment claims are part of a larger economic change underway in this state the past several years. Until there are significant changes in the unemployment system in Wisconsin, you need to be as careful as possible and understand that the Department is always looking for a reason to disqualify you or charge you with concealment if you do end up receiving unemployment benefits.

UPDATE (17 Jan. 2019): Another problem appears for federal employees — having the wages to qualify for unemployment benefits in the first place. Because of the shutdown, federal agencies are not responding to inquiries from state unemployment agencies about verifying employees’ wages. As a result, employees need to produce pay stubs going back a year or more to establish the wages paid out for various quarters. The catch: access to the pay stubs is usually only available to employees when at work using their computers.

A January 15th press release from the House Committee on Ways and Means has the details:

Neal Calls on Secretary Acosta to Help Furloughed Workers Access Unemployment Insurance
 WASHINGTON, DC – Today, Ways & Means Committee Chairman Richard Neal (D-MA) sent a letter to Department of Labor (DOL) Secretary Alexander Acosta calling for guidance to be issued that would ensure that states can provide federal workers not being paid during the government shutdown with Unemployment Insurance (UI) benefits. Roughly 800,000 federal workers are furloughed without pay due to the shutdown, and President Trump has stated that this impasse could persist for many more months. Unemployment Insurance would  help furloughed workers make ends meet and pay for necessities as the shutdown continues.

“During the shutdown in 2013, the Department of Labor moved quickly to make sure this lifeline was available to workers, issuing guidance to state workforce agencies about helping workers access UI benefits, 10 days after the shutdown cut off their pay,” wrote Chairman Neal. “Twenty-four days after the shutdown began, your department has not issued similar guidance to help federal workers navigate this crisis. Indeed, many states are working hard to help these workers, but the lack of guidance and leadership from DOL has impeded their progress.”

Certain UI eligibility requirements – for example, that recipients be actively searching for new jobs, and that they obtain proof of eligibility directly from agencies – can be waived when workers are furloughed or are expected to return to their jobs without pay. However, Chairman Neal pointed out that without guidance on this matter from DOL, “we are hearing reports that some workers have been unable to access benefits, and without guidance, states may not be able to use the flexibility in federal law.” Mr. Neal also raised his concern that as the shutdown drags on, DOL does not act, and more furloughed workers are called back to the office, “this Administration is simply forcing more and more federal workers to return to their work stations without pay or UI benefits.”

Lastly, Chairman Neal pointed out that “the need for unemployment benefits caused by the shutdown will, in the short run, have a negative impact on unemployment trust fund balances, which are already dangerously low in a number of states.” He asked that Secretary Acosta respond and explain “what harm the shutdown is doing to state unemployment insurance trust funds in the short run, whether that impact is triggering tax increases for employers to fund the shortfall, and how you plan to work with states to remedy that harm in the longer term.”

Full text of the letter is available HERE.

As obvious from this press release, the Dep’t of Labor is simply dropping the ball on a host of issues and so adding additional hurdles for federal employees trying to claim unemployment benefits when out of work through no fault of their own.

UPDATE (23 Jan. 2019): For more information about the problems federal workers are having in filing their unemployment claims and actions states can do to ease that claim-filing, see this posting by Andrew Steiner of The Century Foundation.

Note: There is typo in the article. The governors who want the federal govt to pass legislation to allow unemployed federal workers to receive unemployment benefits even when called back to work for no pay are from Michigan, New York and Washington, not Wisconsin.