December 03, 2010
DiNapoli: $13 Billion Negative Economic Impact for NYS with End of Emergency Unemployment
DiNapoli Urges Congressional Delegation to Extend Benefits and Moratorium on Interest Payments
New York state’s economy stands to suffer a $12.9 billion negative economic impact if Emergency Unemployment Compensation benefits are not reinstated by Congress, according to an analysis by New York State Comptroller Thomas P. DiNapoli.
“The state’s economy is just starting to recover,” DiNapoli said. “New York can’t take a $13 billion-packed punch. And New York’s businesses can’t take another kick in the wallet just as they’re starting to show signs of stabilizing. Employers shouldn’t be facing added costs when they’re trying to add back employees. New York’s Congressional delegation must do the right thing and extend the emergency benefits and the moratorium on the interest payments.”
DiNapoli’s analysis showed approximately 200,000 of New York’s unemployment benefits recipients, or 38 percent, stand to lose their benefits this month with the expiration of the EUC program. By May 2011, an estimated 400,000 New Yorkers stand to lose their benefits.
Using the U.S. Dept. of Labor’s estimate that every dollar of benefits paid out produces $2 of economic activity, DiNapoli estimated the negative annualized economic impact of the loss of emergency benefits to New York state would be $12.9 billion.
In addition, New York’s employers will owe $115 million in interest by September 2011 to the federal government on $3.176 billion in outstanding loans to support the state’s regular unemployment benefits program. Employers are taxed to pay for regular unemployment benefits. The current moratorium on the interest payments is set to expire on December 31. DiNapoli sent a letter to New York state’s Congressional delegation urging them to extend the Emergency Unemployment Compensation program and the moratorium on interest payments.
DiNapoli’s analysis also noted, in New York state:
To view DiNapoli’s letter, visit: http://www.osc.state.ny.us/press/nys_congressional_delegation_ltr.pdf.
To view DiNapoli’s analysis, visit: http://www.osc.state.ny.us/reports/unemployment_insurance_snapshot.pdf.