Virginia Unemployment Insurance Update

I’ve been doing all of this talking about unemployment insurance over the last couple of days. All of that talking, and the fact that it is a New Year, full of new promise and new resolutions, has got me to thinking about the past, and old resolutions and old happenings. It got me to thinking about why unemployment insurance was started in the first place in Virginia and in other states across the Union.

I looked it up, and I figure I might as well pass along what I uncovered to your folks out there, my loyal readers who are still with me in 2007. The unemployment insurance system was first created in 1925, with the passage of the Social Security Act. The way it is set up, Virginia and every other state administers the system on its own, along with Washington DC, the Virgin Islands, and Puerto Rico. The U.S. Department of Labor can help out to oversee the system when necessary, but for the most part the system was designed from the get go so that each state could operate the unemployment insurance system on its own, in pretty much its own way. Hence, the reason I have been talking seemingly nonstop for the last few days about how the systems are different in each state.

That means that states like Virginia and every other state gets to charge their own tax rates, pay out their own level of benefits, and determine which employers are eligible for the taxes and which aren’t, along with determining which laid off employees are eligible for benefits or not.

Take Virginia’s system. According to the official figures I got from the Virginia Employment Commission, in Virginia alone more than $339 million was paid out in unemployment benefits in the year of 2005. That’s a lot of mullah. More than 110,000 individuals got their share of that money, for an average of nearly 13 weeks each, at $237 per week.