Throughout this past decade our nation and state has had financial ups and downs, which has caused people to rely on unemployment benefits. In Ohio, our system was maxed out with the federal government having to pay the bill during the last decade. Following this, taxes were raised on employers to make up that lost money. Although many Ohioans are back at work, we can’t forget about this situation and how we can fix the unemployment compensation system.
In order to prevent the need to borrow again in the future to support unemployment compensation, we must help our system reach the “Minimum Safe Level” (MSL), the size of our Unemployment Comp Emergency Fund. This will help us prepare for any future crisis if we continue to build it up, which would result in another tax increase if we didn’t have the money. The MSL is important for our state’s future and we must save accordingly.
Another task we must do is to reduce the number of weeks the system will cover. By doing this we are reducing the risk level, which reduces the costs to employers for the tax. Families across Ohio must prepare for these future employment emergencies and take responsibility.
I believe these changes will have an impact, causing a tax deduction. Employers recently saw an increase in their FUTA tax rates, making this reduction that much more crucial. The new system will gradually bring new employers into this new responsibility to fund this unemployment compensation system and will help new business owners. This will allow the job market to grow and bring a positive outlook to this once broken system.
Finally, for this all to work changes including adjusting specific ways the taxes are collected based on the number of employees an employer has will be undergone. Moving forward, Ohio will start to move into a better and more stable unemployment compensation system that benefits workers and employers. I hope this system will provide Ohio will a rainy day fund to use if an emergency ever did arise.
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