President Barack Obama Makes New Proposal for Unemployment Insurance Plan
By Victor Ochieng
The president unveiled the proposed changes last Saturday, saying they provide more security to employees and encourages experienced members to rejoin the workforce regardless of whether they’re taking a pay cut.
“We shouldn’t just be talking about unemployment; we should be talking about re-employment,” the president said during his weekly radio and Internet address to the nation.
Should the proposals be adopted, states would be required to provide unemployment insurance to workers who lose their jobs and get reemployed at a lower pay. Those who lose their jobs will have the insurance provide half their salary for a period of two years, with the coverage capped at $10,000. According to the proposal, only those earning amounts less than $50,000 and have been with their most recent employer for a period of not less than three years will be covered.
The proposal also seeks to make the insurance available to many part-time and low-income employees and seeks to cover at least 26 weeks of unemployment after job loss.
According to the White House, nine states don’t meet the threshold for providing the insurance.
The proposal comes at a time when most U.S. businesses, aside from those in the manufacturing industry, are seeing a growing demand for expanding the number of employees. According to a recent report released by the government, the unemployment rate hit 5% as employers added a net of 292,000 jobs.
In light of the dropping unemployment rate, the Obama administration has received some credit, giving the administration some guts to counter Republican presidential candidates who’ve been consistently talking down about the economy. The White House has, however, acknowledged that most of the jobs created are low paying, and that many American employees aren’t experiencing any wage growth.
In his Saturday address, Obama said he’s confident the new proposals will make it possible for employees who would like to switch careers to be able to do so and work their way up in their new careers.
On average, experienced workers face a 10% pay cut in the event of job loss, while those with more than 20 years of experience face up to 25% pay cut, according to a White House statement.
The White House intends to include the proposed changes to Congress next month when they present the budget proposal.