Unemployed people face struggling unemployment benefit system in California
Long before COVID-19 destroyed California’s economy, the state’s unemployment insurance program was in deep turmoil.
Thanks to a decades-long political stalemate, the unemployment system, run by the Employment Development Department (EDD), had few reserves to cope with a recession. The unemployment fund had been severely depleted during the Great Recession and EDD officials had warned for years that the fund was deficient, but nothing was done.
Additionally, the Great Recession exposed serious flaws in EDD’s outdated computer system, and although promises were made to upgrade it, little was done before COVID-19 hit and hundreds of thousands, if not millions, of dismissed workers have applied for benefits.
In the first three months of the partial economic shutdown ordered by Gov. Gavin Newsom in March, “one in four Californian workers filed (claiming unemployment) … reaching Great Depression levels,” according to a June study by California Policy Laboratoire, a multi-university think tank.
The result was chaos. EDD has struggled to cope with the deluge of claims for benefits, both those funded by the state through payroll taxes and additional payments hastily authorized by Congress and President Donald Trump.
Those applying for unemployment benefits have complained that they made dozens if not hundreds of calls to verify their claims, only to be frustrated by an inability to make and / or hang up conversations with workers halfway. EDD, many of them newly hired.
âThey told us to be patient and wait because they worked so hard to get us paid in a timely manner,â Robert Good, who worked as a waiter for a Denny’s franchise and tries to get answers from EDD since March. , said the Sacramento Bee. âWe are June 1st. I have no money for food and bills. The EDD keeps adding new extensions and programs, but tells those of us who are stuck and waiting for nothing.
Unsurprisingly, those in the same sinking boat as Good have started to harass their state’s lawmakers for help, and legislative staff have tried to work through the tangled bureaucracy of ESD. But when the EDD put an end to the number of such cases it would deal with – one per week per lawmaker – it did not suit the Capitol.
After lawmakers publicly complained, the EDD quickly amended its weeklong decree, telling lawmakers in an email that the agency “has implemented a recent recommendation from legislative staff to further expedite resolution of your older business “.
The explosion added another layer of tarnish to EDD’s reputation.
Although reporters have little opportunity to question Gov. Gavin Newsom these days, some have sought an answer on the unemployment claims crisis.
“We have been very aggressive on a daily basis to try to cope with the scale of the calls received,” Newsom said at the end of April. “We are just dealing with an unprecedented volume of calls (and) we need to understand that.”
More than two months later, it appears to be still in the process of being discovered as applicants are still frustrated and are even posting tapes of their unsuccessful calls to Twitter and Facebook. National data shows that while California isn’t the slowest state in processing jobless claims, it is near bottom.
No one could have anticipated the sudden influx of COVID-19 unemployment claims, but given the experiences of the Great Recession, especially the flaws in the EDD computer system and the weakness of the unemployment fund, it Much more should have been done to prepare for the inevitable next recession.
We wonder if this will be understood by the next recession.