Department of Labor Announces Unemployment Insurance System Reform
The pandemic sparked many changes in the world, from the growth of Zoom meetings to pointing out shortcomings in many of our existing systems. Positive change can come from challenges, and the U.S. Department of Labor is one of the most recent examples. The federal agency has created a new office to modernize and reform the unemployment system, providing strategic leadership to work with state agencies and federal partners, according to a press release issued this week.
The Office of Unemployment Insurance Modernization will develop and support the implementation of the strategic vision outlined in UI modernization plans announced in August, with the goals of reducing fraud, address inequities in the system, and reduce backlogs with the unemployment insurance system.
In the past year, according to a separate DOL release, the unemployment insurance system helped nearly 53 million workers by funneling nearly $800 billion into the U.S. economy. At the same time, the release said, the pandemic “further exposed longstanding challenges in UI.”
The American Rescue Plan took the first steps in addressing those challenges with $2 billion in funding to ensure timely payment of benefits, combat fraud and reduce inequities. Because UI is managed at the state level, the new Office of Unemployment Insurance Modernization will assist states in implementing better fraud protection measures and updated technology to enable states to process claims faster.
The ARPA earmarked grants totaling $140 million for fraud detection and prevention and another $260 million to promote equity. States will receive funding to invest in fraud prevention, expanded data analytics and cybersecurity defense strategies, as well as technology to improve claim outreach and customer services processes while reducing claim backlogs.
The new office, headed by Yvette Meftah, will work closely with the Employment and Training Administration, the Office of the Chief Information Officer and the Office of the Assistant Secretary for Administration and Management, within the Office of the Secretary, to assist states in these important steps. Michele Evermore, senior advisor on unemployment insurance, will serve as the deputy director for Policy at the OUIM. Deputy directors for Operations, Management, and Technology will round out the team.
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