Unemployment Systems Floundering Without Worker-Centered Design

Report Offers Recommendations for How States Can Successfully Modernize Technology

New York, NY—The Century Foundation, the National Employment Law Project, and Philadelphia Legal Assistance today released the findings of an intensive study of state efforts to modernize their unemployment insurance benefit systems. This is the first report to detail how technology modernization has altered the experience of jobless workers.

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The report, which was supported by a grant from the Robert Wood Johnson Foundation, draws lessons from state modernization experiences and recommends user-friendly design and implementation methods for future projects.

Read the new report, “Centering Workers: How to Modernize Unemployment Insurance Technology”

The COVID-19 pandemic has laid bare the struggling technology holding up our unemployment systems and the harm to workers when they cannot navigate or access their unemployment benefits.  Many state systems were programmed with COBOL, a long-outdated computer language.  While some states have undertaken modernization projects, many encountered significant problems and workers paid the price through inaccessible systems, delayed payments, and even false fraud accusations. The COVID-19 pandemic, which led to an unprecedented spike in unemployment claims, has further exposed the weaknesses in these systems and the difficulties workers face with their unemployment claims.

State officials have at times been candid about the deep flaws in their systems. Pennsylvania’s labor secretary described their 50-year old computer system as “held together with chewing gum and duct tape.”  Florida’s own state auditor found numerous flaws in the state’s new computerized system that went unfixed through multiple administrations. States and the private companies that develop these systems failed to consistently seek worker input and build systems focused on user experience.

The report also explores how modernization and controversial new technology like predictive analytics can affect access to benefits.

“Much remains unknown about how state unemployment agencies are using technology like automated decision-making, predictive analytics, and artificial intelligence,” added Julia Simon-Mishel, supervising attorney of the Unemployment Compensation Unit of Philadelphia Legal Assistance and principal investigator for the report. “While these tools can sometimes be helpful, we remain concerned about fairness, accuracy, and due process.”

“The pandemic has underscored that unemployment insurance is a lifeline for workers, yet state systems are rarely built with workers’ needs in mind,” said Michele Evermore, senior policy analyst with NELP and a co-author of the report. “Our report finds that Black and Latinx workers are particularly poorly served by unemployment insurance systems. We have to do better.”

To date, fewer than half of states have modernized their unemployment benefits systems. Several have plans to modernize or are already in the midst of modernizing. The report provides guidance for them, as well as for modernized states looking to improve their systems.

The report also recommends six steps states can take right now, to expand access to benefits during the pandemic:

  1. provide 24/7 access to online and mobile services for unemployed workers;
  2. mobile-optimize unemployment websites and applications;
  3. update password reset protocols;
  4. use call-back and chat technology;
  5. adopt a triage business model for call centers; and
  6. comply with civil rights laws requiring that websites and applications be translated into Spanish and other commonly spoken languages.

“Modernization needs to be approached carefully to avoid creating new problems for workers,” noted Andrew Stettner, senior fellow at The Century Foundation and a co-author of the report. “Our analysis shows that states were able to pay benefits more quickly after modernizing their systems, but workers were more likely to be denied assistance and too many of these denials were inaccurate. These problems have been magnified during the pandemic when no one should have to choose between paying rent, putting food on the table, and good health.”

The findings and recommendations in the report are grounded in publicly available data on unemployment insurance system performance, interviews with officials from more than a dozen states, and in-depth case studies of modernization in Maine, Minnesota, and Washington, conducted from October 2018 to January 2020.

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The Century Foundation (TCF) is a progressive, independent think tank that conducts research, develops solutions, and drives policy change to make people’s lives better. We pursue economic, racial, and gender equity in education, health care, and work, and promote U.S. foreign policy that fosters international cooperation, peace, and security. TCF is based in New York, with an office in Washington, D.C. Follow the organization on Twitter at @TCFdotorg and learn more at w ww.tcf.org.

The National Employment Law Project is a non-partisan, not-for-profit organization that conducts research and advocates on issues affecting low-wage and unemployed workers. For more about NELP, visit www.nelp.org. Follow NELP on Twitter at @NelpNews.

Philadelphia Legal Assistance is the sole provider of federally funded legal services for low income Philadelphia residents, enforcing and protecting the rights of these individuals and families by providing accessible, creative and high quality legal assistance and working collaboratively for systemic change.  For more about PLA visit www.philalegal.org.  Follow PLA at @Phila_Legal.

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