Unemployment insurance

What is it?

Indiana’s unemployment insurance (UI) program, administered by the state Department of Workforce Development, provides a safety net for workers during a period of temporary job loss.

View photos of huge April 27 construction-worker rally at Statehouse.

 

The problem.

For 16 of the last 18 years, the Unemployment Insurance Trust Fund has taken in less money in UI taxes than it pays out in UI benefits.

In 2001, the UI trust fund had a $1.6 billion surplus. As part of a 2001 deal, to get a cost-of-living adjustment in UI benefits for workers, business were given an unsustainable tax cut. This deal essentially created an unfunded liability for employers.

The UI trust fund officially went broke at the end of November 2008, as a result of continued underfunding of the UI trust fund. To date, the state has borrowed more than $650 million from the federal government.

 

Safety net is under assault by H.B. 1379

As passed by the Indiana Senate, H.B. 1379 would:

  • Deny unemployment insurance (UI) benefits to a greater number of workers.
  • Reduce benefit amounts to those workers who are deemed to be eligible.
  • Eliminate the safety net that UI benefits traditionally provide to unemployed workers.
  • Deny workers $550 million in benefits; the Senate Republican plan calls these benefits “waste, fraud and abuse.”

This ill-conceived package of proposals on unemployment insurance unfairly targets the construction industry. More than 6,000 construction workers from a wide range of skilled building trades rallied at the Indiana Statehouse on April 17 to tell legislators firsthand that the anti-worker UI proposals in H.B. 1379 are an assault on working families and will be recognized as such.

 

Important to economic recovery.

Every $1 paid in UI benefits creates $2.15 in local economic activity. UI benefits paid to out-of-work workers keep others working.

 

Working families can't afford more benefits cuts.

Indiana's unemployed workers have lost $35 a week purchasing power since the last benefit increase four years ago.

Indiana's maximum benefit is already lower than the maximum benefit in any of our surrounding states and is in the bottom half of all states.

Unemployed workers already report having trouble putting food on the table.