THE PROBLEM: Despite increased wages and improved benefit packages, finding workers is still extremely difficult for employers all over Wisconsin. There are approximately 130,000 open jobs posted on the Job Center of Wisconsin website daily, and Wisconsin has one of the tightest labor markets employers have ever faced.
Beyond government benefits competing with private sector employers, the COVID-19 pandemic also brought to light the mismanagement at the Department of Workforce Development (DWD) and the need for systemic reforms to government assistance programs.
POLICY SOLUTION: The workforce crisis is multifaceted, and requires a similar policy response. There is not a silver bullet solution that will turn the crisis around overnight. Still, there are reforms worth enacting that will move the ball forward and help fix the workforce crisis. A series of bills were introduced in the Legislature today to address the crisis on many fronts, including:
- aligning unemployment insurance benefits to real world workforce realities,
- addressing fraudulent activities like “ghosting” job interviews and job offers,
- forcing the state to finally implement welfare reforms enacted by Gov. Walker, including work requirements for FoodShare eligibility for certain claimants, as well as drug screening, testing and treatment requirements,
- refocusing DWD on helping people find reemployment,
- stopping individuals from refusing job offers or pay increases in order to stay on government assistance,
- fixing the systematic problems at DWD to make sure it can respond appropriately the next time there is a spike in unemployment claimants, and
- forcing government agencies to talk with each other to ensure individuals receiving benefits are actually eligible.
See below for detailed bill summaries and links.
BACKGROUND: As stated earlier, despite increased wages and improved benefit packages, finding workers is still extremely difficult for employers all over Wisconsin. There are approximately 130,000 open jobs posted on the Job Center of Wisconsin website daily, and Wisconsin has one of the tightest labor markets employers have ever faced.
The response to the COVID-19 pandemic showed that people are rational. When government benefits are comparable to what workers earn, many will choose to not work. This is not a failure of the individuals or employers, but rather is a failure of the unemployment and welfare systems.
What we all witnessed was an absolute lack of leadership from the Evers’ Administration as DWD fell further and further behind when our friends and neighbors needed help the most. According to a May 2021 report from the Center for Research on the Wisconsin Economy (CROWE) at UW-Madison, The (Poor) Performance of the Unemployment Insurance System during COVID-19 in the United States and (Especially) Wisconsin, more than 70% of benefit payments were delayed more than 70 days last year – the 8th highest rate in the nation. For the week ending September 18, 2021, there were still 35,000 weekly claims, with 12,500 pending appeals with an average age of 55 days. And early in the pandemic, claimants were facing a 13-week delay for their claims to be resolved and benefits paid. According to a report at the end of 2020 from the nonpartisan Legislative Audit Bureau, DWD was responsible for 11 of those weeks.
The package of bills introduced today will help encourage people to reenter the workforce, while fixing many shortcomings at DWD.
WHAT’S NEXT: The Legislature intends to hold hearings in the next two weeks, with a goal of passing the legislation and sending the bills to Gov. Evers to consider yet this session, which ends in early March.
WHAT THEY SAID:
“Everyone has seen the enormous amount of ‘help wanted’ signs throughout Wisconsin. Employers are desperate to fill vacant jobs, and the lack of willing workers has reached crisis levels. There’s an abundance of high-wage jobs and a large number of workers available. The Stronger Workforce Initiative will help remove the government-created barriers between the two.”
-Senate President Chris Kapenga & Assembly Speaker Pro Tempore Tyler August
“As I travel throughout Western Wisconsin, one thing is crystal clear when you talk with business owners, from grocery stores, to restaurants, to large manufacturers – the workforce shortage is real… Right now there are more job openings in Wisconsin than before the pandemic started. We need to take this opportunity now to reform the existing programs in our state, which have failed under the leadership of the current governor, and help those folks get the workforce supports they need to land their next career as quickly as possible.”
-Rep. Warren Petryk, Chairman of the Assembly Committee on Workforce Development
1.Indexing UI Benefits to the Unemployment Rate. This bill recognizes that different times call for different levels of help from the government. When jobs are plentiful, as they are now, the available weeks of unemployment benefits should be less than times when the unemployment rate is high and jobs are hard to find. This bill indexes benefits so they fluctuate along with the unemployment rate, from a minimum of 14 weeks of benefits to a maximum of 26 weeks, the current amount available at all times regardless of the job marketplace. LRB-2943/1 is authored by Sen. Feyen, Reps. Dallman and Vorpagel.
2. Ending “Ghosting” of Interviews and Jobs. One of the biggest frustrations we heard about from employers throughout the pandemic is the issue of “ghosting.” That’s when an individual doesn’t show up for a scheduled job interview or job offer, but still collects unemployment benefits. The proposed bill allows employers to report these incidents to DWD. An individual found to have ghosted is ineligible for weekly benefits under the bill. LRB-3005/1 is authored by Sen. Felzkowski, Reps. Plumer, Moses and Penterman.
3. FoodShare Work Requirement. Current law includes work requirements for able-bodied individuals who don’t have children, as well as drug screening, testing, and treatment requirements. The Department of Health Services (DHS) is not currently enforcing these requirements. Some have not ever been implemented despite having been signed into law by Gov. Walker years ago. The proposed bill requires DHS to implement and enforce the requirements. LRB-5571/1 is authored by Sen. Testin and Rep. Born.
4. Reemployment Assistance. This bill refocuses DWD to incorporate “reemployment” as the core charge of the agency. In doing so, it establishes a program for DWD to match claimants with suitable work and other changes to help people find work and move off of government assistance. LRB-4768/1 is authored by Senator Roth and Rep. Petryk
5. Refusing Work While on Medical Assistance. This bill prohibits able-bodied people who don’t have children from refusing job opportunities or pay raises simply because they want to stay on or maintain a certain level of government assistance. LRB-5788/1 is authored by Sen. Kapenga and Reps. Callahan and Penterman.
6. Unemployment System Reforms. There are many changes needed in the processes utilized at DWD, including many that came to light due to the pandemic. The changes in this bill include extended call center hours when needed, allowing the transfer of state workers to the DWD call centers when demand is high, weekly eligibility cross checks, requiring DWD to do more work search audits, updating the misconduct statutes, providing legislative oversight of future enhanced federal benefits, and provide additional online resources to employers to connect with qualified workers.LRB-4346/1 is authored by Sen. Wimberger and Reps. Armstrong, Petryk, and Penterman.
7. Eligibility Cross Checks. This bill requires state agencies with financial or personal information to share relevant data with DHS for cross checking eligibility for medical assistance benefits. It also requires DHS to affirm an individual’s eligibility every six months, and is required to promptly remove any individual determined to be ineligible. LRB-5789/1 is authored by Sen. Stafsholt and Reps. Penterman and August.