New Yorks labor commissioner says the state is ready to rapidly ramp up its unemployment system again in case the pandemic surges and the economy must shutter once again.
The coronavirus pandemic has taken the lives of tens of thousands of New Yorkers and efforts to reduce its spread by closing businesses in New York City and state forced millions out of work. The state had an unemployment rate of 15.7% in June, up from 3.9% in June 2019.
We are ready, state Labor Commissioner Roberta Reardon said during a Thursday legislative hearing. We know that should the second wave come, we know where the pain points are.
New York has doled out $40 billion in unemployment benefits to 3.3 million New Yorkers in over five months, up from $2.1 billion in benefits processed in all of 2019. Over a third of the states unemployment claims came from workers in particularly hard-hit industries: retail, accommodation and food services, and health care and social assistance.
We have paid over 18 years worth of benefits in just over five months. Thats staggering and sobering, Reardon said.
Still, the surge in applications led to scores of complaints as individuals waited weeks for benefits and struggled with a website that was updated by late April. Reardon said most of the 30,000 complaints were resolved quickly, but state lawmakers who are still fielding complaints from constituents said Thursday that initial delays left out-of-work New Yorkers confused and bereft.
People waited months and months to get benefits, said Sen. James Skoufis, a Democrat in Hudson Valley. They simply didnt know how to make ends meet.
Meanwhile, a supplemental federal unemployment weekly benefit of $600 expired Aug 1. Gov. Andrew Cuomo, a Democrat, has said New York lacks the funds to comply with President Trumps recent executive order asking states to provide 25% of his proposed $400 weekly unemployment benefit.
Cuomo, who said Trumps order poses serious legal questions, estimates it would cost $4 billion for New York to comply with the presidents executive order between now and December.
Reardon said federal funding covers about three-fourths of the unemployment assistance provided this year, and that New York is borrowing $5 billion interest-free from the federal government to pay out unemployment benefits.
New York is one of 11 states who applied and received approval for that loan, which provides advances on unemployment insurance.
This economic crisis is greater than anything weve seen since the Great Depression, and every state is struggling, she said.
Once New York shut its economy down in mid-March, the labor agency saw a huge uptick in calls from jobless New Yorkers seeking help: as many as a million phone calls in a single day, Reardon said.
New Yorkers awaiting unemployment assistance took to social media to demand help in weeks to come as COVID-19 cases and deaths mounted.
By April 20, New York's labor agency said it reduced its application call backlog from 275,000 to 4,305.
Cuomos administration has defended delays by saying they needed to verify unemployment applications: Reardons agency says it stopped over 42,200 fraudulent unemployment benefit claims since mid-March.
The Labor Department hired 500 workers and brought in thousands of employees from other state agencies to help staff call centers that began to operate seven days a week during the height of the pandemic. Reardon said about three out of four applications were processed without issue.
We went from one week with 16,000 applications, the next week had over 100,000 applications, Reardon said. It went up from there for weeks. So that was the problem.
As of late July, roughly 1,200 unemployment claims older than three weeks had yet to be paid, according to the agency. Those applicants may have provided incorrect or incomplete identification or documentation, or an employer could have contested the claim.
Reardon said federal guidance was unclear and confusing early on, but said the states updates to its unemployment system and website including use of chatbots to answer questions, help from Google to revamp the website, and additional computer servers has helped.
More than anything else we are telling people you do not have to call us in order to complete your claim, she said.
Still, several lawmakers said theyre still hearing from constituents with issues obtaining unemployment assistance.
Our constituents are still in the midst of challenges dealing with the Department of Labor itself, said state Sen. Shelley Mayer, a Democrat whose district includes suburban Westchester County. I dont think we should minimize and pat ourselves on the back because were not in a perfect situation.
State Republican lawmakers said the government should protect businesses who fear theyll be forced to pay higher payroll taxes as a result of laying off more workers.
Reardon said a Cuomo executive order has allowed her agency to look into the issue, and said the agency will release recommendations soon.
We understand that businesses are under a tremendous amount of pressure, she said.