Lower Unemployment Costs Would Bring More Jobs (New Bedford Standard Times)
 

July 25, 2010 12:00 AM

A July 11 column by Jack Spillane ("City's desperate worry about a job now, a career later") misrepresents the Massachusetts High Tech Council's position on reforming the state's unemployment insurance system, which is the costliest in the nation. The column, which also criticizes Republican gubernatorial candidate Charlie Baker's similar position on business-cost reform, also includes mischaracterizations of the UI system.

Spillane labels UI recipients in New Bedford as "embarrassed" for "being on the government dole." First of all, UI recipients have earned their benefits and should not be embarrassed by accessing benefits in a deep recession. Furthermore, UI is a wage-replacement system funded on the state level exclusively by employers. It is not a government-funded social program like welfare, which is often called "the dole."

He also suggests that the council is being insensitive to the needs of workers because it is recommending reforms to the system, like bringing the UI eligibility requirements in line with the rest of the nation. In reality, the reforms spurred by the council would increase jobs and prosperity by making Massachusetts more competitive for business growth and investment.

In many ways, Massachusetts is a great place to run a business. But the commonwealth's uncompetitive and unpredictable cost structure, including UI, is hindering growth here, especially on the SouthCoast. How can New Bedford expect to compete for a biotech manufacturing facility with North Carolina, which offers a similar pool of workers and much lower costs?

The council does agree with Spillane on one point: UI benefits should be extended by the federal government during periods of high unemployment. In reality, Massachusetts already provides 30 weeks of UI benefits, which is the longest in the nation. Extending the federal benefits would help preserve the UI Trust Fund through greater utilization of federal funds.

Ideas for improving the state's employer cost structure deserve careful consideration, including the potential impact on workers. If the council's vision for UI reform becomes a reality, Massachusetts will still have one of the most generous programs in the nation, but we will have reduced our competitive cost disadvantage with other states and nations. That would be a positive outcome for all.

Christopher R. Anderson
President
Mass. High Technology Council