Oregon Public Broadcasting

Lay-offs announcements in recent weeks have come like body blows to Washington State’s economy. Now majority Democrats in Olympia are moving ahead with a plan to help the growing ranks of laid-off workers.

They want to give ‘em a raise – in the form of a bigger unemployment insurance checks.

To pay for this increase, Democrats would tap the state’s robust unemployment insurance trust fund to the tune of about $200 million. But the business community is raising red flags. Correspondent Austin Jenkins explains.

This past Christmas, David Farr got coal in his stocking -- a lay-off notice from his job with Thurston County. After 14 years as a building code enforcement officer, he was out of work.

David Farr: “You know you think you’re going to stay some place until you retire and you have to leave. And what I was making there it’s very hard to find a job that pays like that.”

Now Farr is spending his days at the WorkSource office in Tumwater – near Olympia – polishing his resume, writing cover letters and applying for jobs – any job. In the meantime, Farr is collecting about $500 a week in unemployment.

David Farr: “That’s a real cut from what I was getting.”

That’s why Farr is pleased to hear that Washington Governor Chris Gregoire and her fellow Democrats in the legislature want to boost the weekly stipend.

The average worker might see a $45 a week increase. It may not sound like much, but it is to Farr and his wife.

David Farr: “That’s good. That would pay for gas for that week for both of us – or a little more actually.”

Governor Gregoire made the case for her plan last month at an economic summit in Seattle.

Governor Gregoire: “We are very fortunate. Some of the unemployment trust funds around the nation are literally bankrupt. We are the healthiest in the entire nation. Currently we have approximately 4-billion dollars, projected of course to go down in light of the recession.”

It’s the going down part that has Washington’s business community uneasy.

Don Brunell heads the Association of Washington Business. He wants to avoid a repeat of the early 1980s’ when Washington’s unemployment insurance fund ran out of money.

Don Brunell: “So we ended up borrowing money from the federal government to pay benefits for unemployed workers. When you do that you have to not only repay the money, but you have to repay it with interest and then you have to build your reserve back again and that all means higher taxes to the employer.”

Higher taxes, Brunell says, would hurt businesses even more than they’re hurting now.

He recently sent the governor a letter saying hands off the trust fund. He also wonders what’s next.

Don Brunell: “Once you start raiding that fund and we have $4 billion in the fund and there will be a lot of creative proposals to use it for other programs.”

Democrats counter that at $4 billion, the trust fund is over-funded.

The federal government recommends that states have a big enough cushion to cover 12 to 15 months of unemployment benefits.

Currently the state has enough money on hand for 20 months. But demand is growing. With workers being laid off by the thousands, more are signing up for benefits.

At this call center in South Seattle, operators take unemployment insurance claims over the phone. Lately the phone lines have been overwhelmed hold times can top an hour.

In December, a record 90,000 people applied for unemployment benefits.

Calltaker: “Good afternoon, hi my name is Bob. Could I have your name and social security number please?”

Bob – who wouldn’t give his last name for security reasons – knows what it’s like to lose a job. He was laid off in California after the post 9/11 downturn. So he knows the stress the people he talks to are feeling.

Bob: “A lot of times you got to be a good listener and explain to them – because you know I’ve been on the other end as well – that it’s not the end of the world, that another door is going to open. But you know.”

The current demand for unemployment insurance has prompted a larger discussion in Olympia about long-term reforms to the fund.

In the meantime, Bob knows his job is secure. In fact, the state has been hiring call center workers like crazy.