Business & Economy

Walters: Administrative delay worsened the unemployment fiasco

Michael Harrington and Phil Scott
Michael Harrington, interim commissioner of the Department of Labor, discusses the state’s backlog of unemployment claims at a press briefing on April 17, 2020. Behind him is Gov. Phil Scott. Photo by Mike Dougherty/VTDigger

John Walters is a political columnist for VTDigger.

It’s been almost two months since large sectors of Vermont’s economy were shut down, and tens of thousands of Vermonters thrown out of work, due to the Covid-19 pandemic. And after all this time, the state’s unemployment insurance system remains a mess.

“It still hasn’t changed,” said Senate Majority Leader Becca Balint, D-Windham, who serves on the committee that oversees the UI system. “Every legislator I know is getting calls every day from desperate Vermonters who aren’t being helped. It’s heartbreaking to take these calls day after day after day.”

There are many reasons for this. Most of them are outside of any Vermonter’s control, up to and including Gov. Phil Scott. In almost every state, the UI system is burdened with archaic technology; Vermont’s system uses the COBOL programming language, which was omnipresent in the days of mainframe computers and punch cards.

Also, the system isn’t geared for rapid response. “It was set up to minimize fraud, not expedite claims,” said Rep. Charlie Kimbell, D-Woodstock, ranking member of the House Commerce and Economic Development Committee.

“Every system is heavily weighted toward multiple levels of authentication,” explained Labor Commissioner Michael Harrington, the star-crossed bureaucrat in charge of UI in Vermont. “That impedes the ability to move quickly.”

When the waves of initial claims started to hit, Vermont’s UI call center had only 15 staffers. “All funding for the operation is determined by the federal government based on the unemployment rate,” Harrington said. 

Pre-coronavirus, Vermont’s rate was historically low. The call center was downsized last year — not because of a policy decision, but because of a federal cut based on the state’s jobless rate.

And then came the rolling shutdown of almost everything. On March 13, Scott declared a state of emergency. On March 15, he shuttered the public schools. The next day, he announced that bars and restaurants would close. And on March 24, he issued his “stay home, stay safe” order.

All but essential businesses were shut down. New unemployment claims skyrocketed, totaling nearly 15,000 in the week of March 15, almost the same the following week, then 16,000 the week of the 22nd, 10,000 the week of the 29th, and 6,600 the week of April 4. (Remember that a “mere” 6,600 is more than 10 times the usual workload.)

This, for a system designed to handle a few hundred claims per week. And unemployed Vermonters are still paying the price.

“If I knew then what I know now, I might have done things differently,” said Scott at his May 8 press briefing. “But I don’t have a crystal ball.”

A similar sentiment came from Rep. Michael Marcotte, R-Coventry, chair of the House Commerce and Economic Development Committee. “Hindsight is 20-20,” he said. “I think they were hoping they could get through it. It didn’t happen.”

That’s true — at least it was before mid-March. But at what point should the crisis have become clear, even to the non-clairvoyant? During that first week of 15,000 claims? Surely the second week, when the economy was effectively shut down? Or the third week, when initial claims hit their highest point — and the cumulative total was about a year’s worth in normal times?

Nope.

It wasn’t until April 10 that the administration issued an expedited request for bids for contractors that could help staff the phones. The sole bidder, Maximus, was given the contract.

To be clear, the Labor Department didn’t completely stand pat with 15 people until then. It shifted other department staff to the phones; it got some people from elsewhere in state government; and some businesses chipped in some help.

But the call center didn’t reach 100 people until the end of April, according to Harrington. By then, the Pandemic Unemployment Assistance program, an entirely unprecedented effort to provide benefits to the self-employed, had come online, adding new complications and a flood of new applications. Harrington now says he’s aiming for 200 people answering calls as soon as possible.

And Vermonters, some of whom have gone six weeks or more without an income, are still dealing with busy signals.

If you ask administration officials why it took so long, you get more hints than straight answers. 

“We were dealing with the initial onslaught and troubleshooting,” said Harrington. One can sympathize with his beleaguered staff trying to bail out the Titanic with teaspoons. But couldn’t someone in the administration have taken notice of the crisis, and engaged in some creative thinking?

“Did we think about how the system has worked, instead of how it could work?” Balint asked. “Early on, they could have said, ‘This just isn’t going to work. We have to try something else.’”

That idea may have run afoul of a department whose primary focus is on fraud prevention. That creates an internal culture resistant to new ideas.

“We need people who can not only answer the phone, but are knowledgeable about the system,” said Harrington. “Until someone works in the system, they have no idea how hard it is.”

Granted, but why not bring on board some minimally-trained staff — even if all they can do is refer claimants to the DOL website, offer some rudimentary guidance, or even just take down contact information?

How about an electronic version of same? “My committee has suggested an automated voice message system that could direct people to sources of information,” said Sen. Michael Sirotkin, D-Chittenden, chair of the Senate Economic Development, Housing and General Affairs Committee. “Let people hear something at the other end of the line. There’s nothing worse than calling repeatedly and not getting through.”

Sirotkin said the idea has been repeatedly rebuffed by the administration.

There’s been an admirable persistence in the Labor Department’s efforts. They really are doing their best, and working as hard as they can. But somewhere up the chain, there’s been a failure of imagination.

At his May 8 press briefing, Scott emphasized the unprecedented nature of the situation and lamented his lack of crystal ball, before saying “If there’s blame, I’ll take my part, but we did the best we could.”

No, governor, you didn’t. You did the best you could within the parameters of the system. But the crisis was significantly lengthened and worsened because no one stepped in and seized the reins. And the suffering of thousands of Vermonters has been exacerbated because of that.

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John Walters

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