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Testimony on HB 2400 Regarding Unemployment Compensation

Testimony at Public Hearing Regarding Unemployment Compensation presented by Carol Goertzel, President/CEO of PathWays PA June 16, 2010.

Good morning members of Labor Relations Committee, and thank you for allowing us to testify today. My name is Carol Goertzel, and I am President and CEO of PathWays PA, an agency that has been committed to keeping families together and providing both advocacy and services to and on behalf of at-risk children, teens, women, and families for over thirty years. We work directly with over 6,000 individuals each year.

Based on our experiences, we know that families are struggling every day to make ends meet, and the struggle has only been getting harder during this recession. As state government works to keep up with demand, we are here today on behalf of HB 2400, which as you know was introduced by Representative Marc Gergely. We have worked closely with Representive Gergely on several issues and appreciate his, as well as this committee’s, hard work and support of working families.

We support HB 2400, which will modernize unemployment compensation in Pennsylvania and allow the state to qualify for federal funding, because we know firsthand what families need in order to be self-sufficient. PathWays PA is perhaps best known for publishing the Self-Sufficiency Standard of Pennsylvania. In the latest edition of the Standard, which was released on May 20, 2010, we show that a family of four needs to earn $43,918 in Northumberland County to make ends meet. In Allegheny County, that same family needs to earn $56,865, while in Lancaster County, that family needs to earn $54,821. Even before this recession, 1 in every 5 households in Pennsylvania was struggling to reach the Standard. Today, any loss of income, even in the short-term, can bring dire consequences to a family, as it could result in the loss of healthcare, electricity, heat, access to good food, and housing. While unemployment compensation does not bring a family back to their level of earnings while working, it does help prevent some of these losses for our families.

Under HB 2400, Pennsylvania would join with 38 other states that use an Alternative Base Period (ABP) to calculate unemployment benefits. While the federal government has extended unemployment benefits, without the ABP, some unemployed workers do not qualify for unemployment insurance because of the method by which benefits are calculated. Under the current model, the most recent earnings of a worker are disregarded. This method causes few delays for higher wage employees displaced from a long-term job. But the system hurts low-wage workers who experience short spells in several service sector jobs—a large and growing segment most in need of coverage. If someone works irregular hours, has just started a job, or has received a raise in the quarter before the layoff, their unemployment coverage will not accurately reflect their wages. Instituting an ABP, which allows earnings to be calculated from a different quarter in a worker’s earnings, would help alleviate this problem.

Other changes in this bill are vitally important to the success of Pennsylvania’s workers. One, which would allow individuals to receive unemployment while undergoing job training, will ensure that families can support themselves while they work to secure a better future. More than half the adult population (25 and over) in Pennsylvania has ended their school career with a high school diploma or GED. In 2008, Pennsylvania had the third highest percentage of 18 to 64 year olds with only a high school degree or a GED. Whether in a factory or in the healthcare field, this generation of workers needs at least some post-secondary education to earn a family-sustaining wage. In Pennsylvania today, half of all jobs (51 percent) require some postsecondary education or training (though not necessarily a bachelor’s degree), yet more than half of all Pennsylvanians lack the skills to perform them. This disconnect leaves too many adult Pennsylvanians competing for the 19 percent of jobs available to those with only a high school education. By providing access to training and unemployment compensation while the training occurs, a worker will be better prepared for the job market and less likely to need unemployment compensation or other public benefits in the future.

Of critical importance to Pennsylvania families is a provision in the bill which will provide unemployment compensation to individuals who leave work to address the effects of domestic violence. For many who are abused, their job is the only link they have to financial independence. Without a job, they become more reliant on their abusers, and in some cases must return to an abuser to put a roof over their heads. By providing unemployment compensation for survivors of domestic violence, workers who have been abused can focus on the immediate needs that they are facing while having some financial security.

HB 2400 will be beneficial to families across the state. We ask that you pass it as soon as possible, and we look forward to working with all of you on other important bills, such as Healthy Families, Healthy Workplaces, in the near future.




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