The amount of time Kentuckians could collect jobless benefits would be cut under a bill that passed out of the state House of Representatives last week.
Supporters say the measure would encourage unemployed people to find work, but detractors argue it would make recessions more difficult and add red tape to an already complicated system.
House Bill 4 would reduce the maximum number of weeks someone can collect unemployment benefits from 26 weeks to 24 weeks, and when the state’s unemployment rate is low, the maximum time would be reduced even further.
If Kentucky’s employment rate is less than 4.5%—as it is currently—an unemployed person could only collect benefits for a maximum of 12 weeks.
The proposal would also create new job search requirements, compelling unemployed people to show they’ve made five different attempts to find a job each week to continue receiving benefits.
Rep. Russell Webber, a Republican from Shepherdsville, said the policy is aimed at getting more Kentuckians to participate in the workforce.
“With the lack of adults that are participating in the job market, in the job area, we cannot be known as a state without workers, or a state that is short on workers,” Webber said.
Kentucky has had a low workforce participation rate for years, a phenomenon experts have partly blamed on the opioid epidemic and retiring baby boomers. But the number of people working or actively looking for work decreased even further during the coronavirus pandemic.
The policy to tie the length someone can collect jobless benefits to the statewide unemployment rate is known as “indexing.” It’s been pushed by conservative groups, including the Foundation for Government Accountability, which also advocates for adding work requirements for people to receive Medicaid benefits.
The group named then-Gov. Matt Bevin as its governor of the year in 2018for his attempt to create a Medicaid work requirement for Kentuckians, an effort that was ultimately blocked by a federal court.
Kate Shanks, vice president of public affairs for the Kentucky Chamber of Commerce, said the proposal would spur more unemployed people to find work.
“We know people tend to work more intensely when their benefits are going to end and reducing the weeks when more jobs are available means getting people back to work more quickly,” Shanks said.
The measure quickly advanced in the legislature last week, passing out of the Republican-controlled House of Representatives hours after it was heard in committee. It now heads to the Senate.
But several Republican lawmakers who represent rural areas—especially in eastern Kentucky—attempted to derail the effort, arguing that the measure would disproportionately hurt their districts, which generally have much higher unemployment rates than the state average.
Rep. John Blanton, a Republican from Salyersville, implored lawmakers to not pass the bill during a speech on the House floor.
“For the people of my district, for the people of my region, let me beg of you not to do this,” Blanton said.
The bill passed the House 57-37 with 15 Republicans joining all 22 Democrats present voting against it.
Democratic Gov. Andy Beshear voiced opposition to the bill, saying it would be a “second kick of the mule” for people already struggling to find work amid the pandemic.
“I’m opposed to it and it’s not going to help our workforce participation. It’s just going to harm some people who need that safety net benefit,” Beshear said.
