Who pays for extended unemployment benefits?

 Chris Wodke

http://www.summittrainingpublications.com/

Congress and President Obama agreed to an extension of unemployment benefits for another 13 weeks. This is in addition to the 99 weeks already offered.  The question is who pays for these extended benefits.

Each state is responsible for paying for the extended benefits of its citizens.  It is business owners that are taxed by the State. This contributes to the already high taxes paid for by business owners in Wisconsin.  Wisconsin was borrowing for their unemployment fund early in this recession. About half the states have borrowed money from the federal government. This money must be paid back.  The states are getting this money back by charging business owners more for their unemployment insurance. 

Each employer pays 6.2 percent of the first $7000 of income for each employee plus a flat rate to the government to fund the system. Bills are doubling and tripling in some cases. Imagine seeing an increase from $1000 to $6500 dollars for a quarterly premium 

This extra expense is tough when many small organizations are struggling to survive. These same companies are also seeing dramatic increases in health care premiums.

This is another example of government making laws and putting programs into place that are destructive to business. The government is paying people not to work, then charges business. The business then has less money to hire workers. They may even let workers go as their costs go up due to the cost of government regulations.

The extended benefits may be necessary; the federal government should reduce spending in another area to pay for the extended benefits. This would be a better solution then passing on the expense to business organizations that are already struggling.

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