In summary
The state’s unemployment insurance debt, which ballooned as a result of the pandemic, is in dire straits with no clear path forward.
Lea este artículo en español.
California’s unemployment insurance fund is $20 billion in debt, putting the state in a terrible position in case of a recession.
The deep debt — incurred during the COVID-19 pandemic as millions of people lost their jobs and the state borrowed money from the federal government for unemployment benefits — is on Gov. Gavin Newsom’s mind.
He cited it as a factor in his recent veto of a bill that would have allowed striking workers to be eligible for unemployment benefits, mentioning that the state is paying hundreds of millions of dollars of interest on the debt.
It’s also top of mind for businesses, which face an increase in required contributions toward the state’s unemployment insurance fund as a result. And it’s on the minds of those who are concerned about whether the state’s unemployment system can handle another crisis such as a pandemic or a recession.
The unemployment insurance fund had regular solvency issues even before the pandemic. Now the situation is more dire, with the Employment Development Department issuing a spring forecast that the debt — which the Legislative Analyst’s Office has said does not include the infamous unemployment fraud that mostly involved temporary federal benefits that the state doesn’t have to pay back — would grow to $19.7 billion at the end of the year. In...
A bitter legal battle at JPMorgan Chase has taken another dramatic turn after executive Lorna Hajdini filed a defamation lawsuit against former banker Chirayu Rana, accusing him of making up false...