Factors Affecting Unemployment Insurance Trust Fund Solvency

Thank you, Chairman McDermott, Ranking Member Linder, and other members of the Subcommittee for the opportunity to appear before you this morning to discuss the solvency of the unemployment insurance (UI) system. My name is Alex Brill, and I am a research fellow at the American Enterprise Institute.

This is an important and timely hearing. As Department of Labor (DOL) Assistant Secretary for Employment and Training Jane Oates recently noted in testimony to the Senate Finance Committee, "It is clear that solvency of the UI system will be a concern over the next decade." I share the concern about the viability and health of many state UI trust funds and am concerned about labor markets in the United States generally over the near and medium term. My testimony today will focus on three topics:

  1. The deterioration in labor markets nationally and on a state-by-state basis.

  2. The current insolvency of many state trust funds and the appropriate way of measuring trust fund solvency.

  3. The impact of recent federal policies on labor markets and the impact of those policies on UI trust fund solvency.

I will begin with a brief overview of the current labor market. I will then discuss UI trust funds generally before focusing on the effectiveness of federal policies to promote job creation--the single most important determinant of trust fund solvency.

Click here to view the full testimony as an Adobe Acrobat PDF.

Alex Brill is a research fellow at AEI.

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About the Author

 

Alex
Brill
  • Alex Brill is a research fellow at the American Enterprise Institute (AEI), where he studies the impact of tax policy on the US economy as well as the fiscal, economic, and political consequences of tax, budget, health care, retirement security, and trade policies. He also works on health care reform, pharmaceutical spending and drug innovation, and unemployment insurance reform. Brill is the author of a pro-growth proposal to reduce the corporate tax rate to 25 percent, and “The Real Tax Burden: More than Dollars and Cents” (2011), coauthored with Alan D. Viard. He has testified numerous times before Congress on tax policy, labor markets and unemployment insurance, Social Security reform, fiscal stimulus, the manufacturing sector, and biologic drug competition.

    Before joining AEI, Brill served as the policy director and chief economist of the House Ways and Means Committee. Previously, he served on the staff of the White House Council of Economic Advisers. He has also served on the staff of the President's Fiscal Commission (Simpson-Bowles) and the Republican Platform Committee (2008).

    Brill has an M.A. in mathematical finance from Boston University and a B.A. in economics from Tufts University.

  • Phone: 202-862-5931
    Email: alex.brill@aei.org
  • Assistant Info

    Name: Brittany Pineros
    Phone: 202-862-5926
    Email: brittany.pineros@aei.org

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