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Arizona Chamber President: Congress Must 'Get Its Act Together' On Unemployment

Published: Tuesday, September 8, 2020 - 2:07pm
Updated: Tuesday, September 8, 2020 - 3:08pm
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Kaely Monahan/KJZZ
Glenn Hamer in KJZZ's studio in 2019.

STEVE GOLDSTEIN: The Arizona Department of Health Services is reporting 81 new cases of COVID-19 in the state, bringing the total since the [start] of the pandemic to more than 206,000. It's worth noting the numbers reported after a weekend are typically lower than normal, and two deaths are being reported; 5,221 Arizonans have died because of COVID-related illness.

LAUREN GILGER: Hundreds of thousands of unemployed Arizonans are again facing a benefits cliff. More than half of the money they are currently receiving will disappear when their current federal supplement again expires. But the state's troubles do not end there. With 44 other states also drawing on the available federal dollars, state Department of Economic Security (DES) Director Michael Wisehart says the money may soon dry up.

MICHAEL WISEHART: Right now, the thing we know for sure is that we can pay this week. We have an expectation, but no certainty yet that we will be able to pay next week. As we head toward the seventh week, it becomes much more of a challenge for the dollars to be available.

GOLDSTEIN: And if that wasn't bad enough, Wisehart says the state is rapidly burning through its existing unemployment fund.

WISEHART: We're spending about $50 million per week from the Unemployment Insurance Trust Fund, so we've got about eight weeks or so of solvency left.

GOLDSTEIN: Arizonans receiving those funds don't necessarily have to worry about them disappearing, not more than they already may worry about that anyway. But the money will have to come from somewhere, and that'll come at a price to businesses in the long run.

WISEHART: You just borrow money from the Department of Labor, but you have to pay that money back through taxes on employers going forward. So, again, from a policy perspective in the state, we continue to have dialogue about the implications of that reality.

GILGER: And joining us now to maybe start that dialogue is Glenn Hamer, president and CEO of the Arizona Chamber of Commerce. Good morning, Glenn.

GLENN HAMER: Good morning.

GILGER: OK, so we just heard the DES director say, you know, "Oh, sure, you can just borrow money to keep paying these benefits," but this is not free money, obviously. What would this mean for business owners or employers going forward?

HAMER: Well, what we need is Congress to act before the election. We applaud Gov. Ducey for being the first governor in the country to accept the administration's additional $300 supplement. We know that this is an extremely important issue for for those who are out of work through no fault of their own, as well as it's a very difficult issue for businesses. If you look into the future, if the federal government doesn't act, because ultimately it's businesses that pay this tax. And we have to still remember, while a lot of jobs have come back since the pandemic hit us about six months ago, nationally we're still about 50% off in terms of total jobs lost. So we have a long way to go for a full recovery.

GILGER: So as you say, this might end up on the backs of businesses in the future. How much of a burden could this be for them?

HAMER: Well, it's one of the major burdens for employers and our strong hope is that Congress can get its act together. It's not just Arizona. This is a 50-state issue. And one of the clearer areas where Congress should be able to agree with the administration is to do something additional in terms of unemployment insurance benefits, as well as helping states like Arizona that are going to soon be in a cash crunch. I'm still optimistic that Congress will get its act together and pass one last relief bill before the election.

GOLDSTEIN: Glenn, we always appreciate your optimism, especially in these uncertain times, as we like to call them. But as much as Congress does need to act, should the governor, should the legislature be doing something? You know, we've talked about how low the Arizona unemployment payout is, and it's very, very low compared to other states. Could the state tweak that a little bit in accord with what Congress should do? Because I don't think most people would disagree with you that Congress should act. But should the state, could the state be doing something on its own?

HAMER: We do think that it is worth looking at Arizona modernizing its system, and we've learned through this pandemic, not all sectors are equal in terms of how they've been hit. You know, for example, if you're in information technology, you're doing a lot better than, say, if you're in the hospitality industry, the restaurant industry or even small retail. So we're all for modernizing our system. But, but realistically speaking, the big bazooka is really on the federal level. And it's, and we're really going to need Congress and the administration to get its act together, enhance the benefits for a period of time, as well as help states like Arizona that are soon going to be in a world of hurt because of the pandemic.

GILGER: Let's talk about what this could look like, Glenn. I mean, we have not seen Congress do anything yet. There's talk now that it might not happen until after the election, which is some time off. What might this look like here?

HAMER: Well, again, it's simply going to be impossible for states to do anything even close to what the federal government can do. We can't print money on the state level. And as you have already reported, the state system is already under serious duress. And anything that we do to increase the burden on businesses is simply going to make it more difficult to recall workers who have been laid off or to even keep workers on the payroll. So I don't believe there's any substitute here for congressional action. Yes, we could do some things on the state level, but it's going to be nowhere near the impact of what can be done on the federal level.

GILGER: So when you say we can do things on the state level, what do you mean by that? What you mean by modernizing the system?

HAMER: Well, I'm not talking about anything in the next week or so. So I'm talking about things like looking at overall benefit levels, looking at how those benefit levels are paid. Looking at how different sectors of the economy are hit. You know, it's important to remember that six months ago, which seems like 60 years ago, the biggest problem in Arizona was that we had too many jobs open and too few people to fill them. I mean, in a typical week, we'd have 3,000 people filing for unemployment benefits. At its absolute peak, it was 50 times that amount. It was 150,000 Arizonans at the worst part of this pandemic. So this has all happened very quickly for the state of Arizona. And again we recognize that. And every story that you run or any outlet runs, they talk about our low benefits. But it's important for people to remember that six months ago, people who wanted to find work, by and large, could find work and had multiple opportunities. That's not the case right now, particularly for certain very, very hard-hit sectors.

GILGER: All right. That is Glenn Hamer, president and CEO of the Arizona Chamber of Commerce, joining us this morning. Glenn, thank you so much for the time.

HAMER: Thank you.

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