Wisconsin Unemployment Fund In Danger Of Running Out Of Money

MILWAUKEE, WI — State officials in Wisconsin are growing concerned that the state's Unemployment Insurance Trust Fund could run out of money after about 512,000 people filed for unemployment since the coronavirus public health emergency began in mid-March.

State officials said Wisconsin will exhaust its funds based on how many claims they see next.

As of Wednesday, the Trust Fund balance stood at $1,862,656,170. State officials say they're experiencing unprecedented claim volume with more than 300,000 weekly claims, which is 194 percent higher than the average number of weekly claims received during the first year of the Great Recession in 2009.

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Officials drew up three hypothetical scenarios ranging from a high of 255,000 payable claims per week to a low of 85,000 payable claims per week. The impact of a third, middle scenario, is also included, which assumes 170,000 payable claims per week.

Under the scenarios, exhaustion dates range from Oct. 2020 in the high-claim scenario to Sep. 2021 in the low claim scenario.

"Due to the uncertain future impacts of COVID-19, it is unknown if Wisconsin will continue to experience this high volume of claims and for how long this may occur," officials with the State Department of Workforce Development said. "For this reason, it is difficult to project when or even if the Unemployment Insurance Trust Fund may exhaust and Wisconsin will need to borrow from the federal government in order to pay benefits, as it did during the Great Recession."

According to an ABC News report, if Wisconsin does have to borrow from the federal government, they'll be drawing from the U.S. Federal Unemployment Account, which contained $78 billion as of Thursday. Nine states not including Wisconsin are believed to be on track to borrow $38 billion by July.

The analysis below is based on the following assumptions:

An average weekly benefit amount of $325; 85 percent of claims will paid from state Regular Unemployment Insurance; and 94 percent of benefits will be charged to the Unemployment Insurance Trust Fund.

This article originally appeared on the Milwaukee Patch