Unemployment Insurance Debt Clock Continues to Tick on New York State
869 Days Without Action Increases the Burden on State’s Employers
ALBANY – As the legislative session winds down with no expected attempt to address the state’s Unemployment Insurance (UI) fund debt, The Business Council of New York State, on Wednesday, unveiled a clock that monitors how many days have passed without New York lawmakers taking action to minimize the debt created by state-mandated shutdowns.
The clock currently sits at 869 days, the time since the first proposed state budget was introduced with knowledge of a massive UI fund deficit. The website tracks the days without action, links to an updated deficit, has a timeline of events leading to the debt, and houses three years of media stories warning that the deficit would be a problem for businesses.
Since the pandemic, more than 35 states have borrowed money from the federal government to fund their UI programs, and all but one state, New York, has either paid back the debt or used some sort of state funding to alleviate the burden on their private sector employers. Most states used federal American Rescue Plan Act (ARPA) funds to address the problem.
“The Business Council began warning state lawmakers shortly after the pandemic began that the deficit could grow into the billions and that, if not addressed, would have a severe impact on the state’s employers, particularly small businesses,” said Heather Mulligan, President & CEO of The Business Council. “The current $8 billion debt, created by state-mandated shutdowns, will take businesses over a decade to pay back. Sadly, this deficit is on top of the already increasing costs of doing business in New York state.”
Under existing state law, the entirety of the federal advances must be repaid through increased payroll taxes on employers, with these high federal and state payroll taxes likely lasting the rest of this decade or beyond.