Pages

Sunday, May 8, 2011

Florida's HB 7005: Deal struck, Governor expected to sign

Michael C Bender, writing for the St. Petersburg Times, reports on HB 7005's imminent passage:

TALLAHASSEE — Out-of-work Floridians would receive fewer state benefits while businesses pay less tax under a controversial proposal approved Friday by a divided Legislature.

The deal, which Gov. Rick Scott is expected to sign into law, immediately cuts unemployment benefits by 11.5 percent.

Jobless Floridians would continue to receive a maximum payment of $275 per week, among the lowest of any state in the country. But they would be paid for no more than 23 weeks, instead of 26.

This is exactly why the GOP's "JOBS Act" bill must be voted down, and why we have to push as hard as we're able to on behalf of H.R. 589: the "JOBS Act" would further accelerate the race to the bottom that states like Florida have created.

Businesses in Florida already pay the lowest UI tax rates in the nation: a maximum of $378 per employee. Florida also has one of the nation's highest unemployment rates: 11.1% (sources: Tax Policy Center (XLS file), BLS LAUS)

In contrast, states like North Dakota, Minnesota and Utah have relatively high UI tax rates, costing employers a maximum of between $2,470 and $2,925 per employee. These three states also have some of the lowest unemployment rates in the nation: 3.6% for ND, 6.6% for MN and 7.6% for UT. The US unemployment rate is 9.0%.

Is there a correlation between UI tax rates and unemployment rates? Yes, there is, but not in the way advocates for lower taxes might think. The numbers show that there's a slight negative correlation between the two rates: as UI taxes go down, unemployment goes up. (For the statistically-minded, the correlation coefficient is -0.2259)

0 comments:

Post a Comment