The Washington State Employment Security Department (ESD) will release the Unemployment Trust Fund Forecast later this week, outlining that the department may utilize an interest-free federal loan to pay benefits by the end of the year, based on the latest economic forecast data.
Washington began this crisis with one of the strongest trust funds in the nation. The Washington Unemployment Trust Fund’s balance was over $4.7 billion at the beginning of March. Throughout the crisis ESD has monitored the health of the trust fund, currently at $2.8 billion, and reported the balance regularly.
As part of the department’s responsibility to manage the trust fund, ESD utilizes information from a variety of sources including the Washington State Economic Forecast Council. The Economic Forecast Council’s June forecast anticipates a slow economic recovery, with higher unemployment and lower revenue. As a result, projections now show that ESD may need to obtain an interest free federal loan by the end of this year in order to maintain solvency and ensure that benefits continue uninterrupted.
There are already multiple states utilizing this federal loan option to pay out benefits.
“Since the beginning of this crisis, our unemployment trust fund remains one of the strongest in the nation,” said ESD Commissioner Suzi LeVine. “It was designed by an incredible partnership of policy makers, labor and businesses to ensure the benefits would be there when Washington workers needed them most. The fact that we will be amongst the last states to require assistance from the federal government speaks volumes to the strength of the program these partners designed.”
Once completed – the full Unemployment Trust Fund Forecast report will be available at: esd.wa.gov/labormarketinfo.