On Thursday, the data analysts at Wallethub released a report ranking New Hampshire one of the worst-performing states in getting people off of unemployment and back to work.
But just days earlier, the New Hampshire state Senate passed unemployment insurance legislation that critics say encourages people to keep collecting rather than return to work.
Most notable is language authored by Sen. Dan Feltes (D-Concord) in the Senate bill allowing people to decline to work and collect benefits if they believe there is “a reasonable risk of exposure or infection.” This too-scared-to-work clause keeps the checks coming even if the workplace has met all Centers for Disease Control and Prevention and N.H. Department of Health guidelines.
So which one is it? Does New Hampshire need laws to make unemployment easier? Or is the state making it too hard to get workers back on the job?
Nationwide, “the latest job report shows new unemployment claims 78 percent below the peak during the COVID-19 pandemic,” Wallethub reports. The decline has been slower in the Granite State.
New Hampshire had the second-highest surge in initial jobless claims per capita since the COVID-19 emergency began, trailing only Georgia. The rate of weekly initial unemployment claims compared to the first of the year is the fourth-highest in the country.
New Hampshire Employment Security Deputy Commissioner Rich Lavers tells NHJournal the picture isn’t as bleak as the one painted by Wallethub.
“They’ve focused exclusively on initial jobless claims. Those numbers were an important indicator in March and April, but we believe active weekly claims — people who [are] continuing to collect benefits — is a better measure of our economy now.”
Lavers notes that when the lockdown began, there were more than 200,000 initial unemployment claims. But the highest number of active weekly claims paid at the lockdown’s peak was just 116,000. What happened?
“We don’t have the data, but anecdotally it appears that people filed when the crisis first began because of uncertainty about what their employers were going to do,” Lavers said. “Once the picture became clear, many workers discovered they weren’t going to need the benefits.”
Lavers says the active unemployment claims have been declining by about 4 percent per week, a steady and — in Lavers’ view — healthy decline, a sign that the job growth and strengthening economy isn’t a fluke. “On Thursday, our active weekly claims fell below 100,000 for the first time since early April,” Lavers said.
And yet the fact remains that even tracking the active cases, New Hampshire’s jobless claims per capita are higher than many other states. And even some Democrats concede the level of benefits, in particular the $600 a week in federal unemployment benefits, is discouraging workers from returning to their jobs.
“The extra $600 a week from the federal government wasn’t well thought out,” Sen. Lou D’Allesandro told NHJournal. “People were getting more from unemployment than they were earning at work.”
“We understand that with all the incentives out there, it’s a challenge [to get people back to work], given that there’s a lot of money to be had on the unemployment side,” Gov. Chris Sununu said at Thursday’s COVID-19 presser.
Even progressive state Sen. Jeanne Dietsch (D-Peterborough) broke ranks with her fellow Democrats to vote against a Feltes proposal to make the additional $100 a week in state COVID-19 benefits permanent.
And if the Democrats’ expansion of benefits isn’t hurting employment, it could do some serious damage to taxpayers. As Lavers told senators last week, and reiterated to NHJournal Thursday, the Democratic proposals put New Hampshire out of conformity with federal guidelines and, therefore, ineligible for federal dollars to cover the costs.
“This would mean that New Hampshire employers would no longer be eligible for their 90 percent reduction in their federal unemployment tax obligations,” Lavers told senators last week. “This would cost New Hampshire businesses over $200 million a year.”
“Normally, the guidance we get from the Department of Labor is a little vague, it leaves the instructions unclear,” Lavers added Thursday. “Not this time. They are explicitly saying if we are out of compliance, we will lose the money.”
And it is a lot of money.
Over the past three months, New Hampshire has paid out just under $800 million in unemployment benefits. To put that in perspective, the most money New Hampshire Employment Security has ever paid out in an entire year was $391 million in 2009 during the Great Recession.
Making up 90 percent of that amount of money would be impossible for New Hampshire. “Putting all this money at risk, why they [Senate Democrats] would do that, I don’t know what the legislators were thinking,” Sununu said. “It’s a terribly crafted piece of legislation.”
Democrats acknowledged this danger by including language to undo their own legislation if it does, in fact, run afoul of federal rules.
“In the event the United States Department of Labor provides a written notice to the New Hampshire department of employment security that any specific statutory change in this act will result in the loss of federal funding to New Hampshire then that specific statutory change, and that specific statutory change only, shall be inoperative,” the amendment reads.
Critics say it’s a sign Democrats are engaged in legislative theater. “Passing a bill with its own ‘self-destruct button’ isn’t governing. It’s politicking,” says Andrew Cline of the Josiah Bartlett Center.
“Putting all this money at risk, why they [Senate Democrats] would do that, I don’t know what the legislators were thinking,” Sununu said. “It’s a terribly crafted piece of legislation.”
Democrats dismiss the criticism as a GOP distraction.
“Whether it is one of the worst-in-the-nation COVID-19 nursing home crisis, the highest health care costs in the nation, or an unemployment insurance system that left thousands without help for weeks, Chris Sununu’s time is spent doing taxpayer giveaways to campaign donors and doing photo ops and press conferences, not solving the problems on the ground that ordinary people face. I’ll continue to fight for working families, despite the misinformation campaign of Chris Sununu and his political appointees,” Feltes told NHJournal.