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Small businesses, job-seekers set to benefit from reforms to unemployment law

Small businesses in Alabama are optimistic a new law will help provide them a better trained workforce and alleviate some of the regulatory costs they have carried in the past.

State Rep. Danny Garrett (R-Trussville) and State Sen. Arthur Orr (R-Decatur) sponsored the bill which passed during this year’s legislative session. The aim of the law is to ease the burden on employers while at the same time helping job-seekers get better prepared for today’s economy.

Garrett explained to Yellowhammer News that unemployment benefits are paid entirely by the employer and that reducing the number of weeks the business has to pay the benefits reduces their overall costs.

At the same time, the new law creates opportunities for unemployed individuals to gain extra weeks of unemployment compensation if they are participating in job training.

“The new law cuts the weeks of unemployment from 26 weeks to a lower number of weeks based upon the actual unemployment rate,” Garrett outlined. “Today, the weeks that unemployment benefits could be drawn would be 14 weeks. For each one-half percent increase in unemployment, an additional week of benefit would be paid, up to a maximum number of 20 weeks. However, regardless of the weeks as determined by the new scale, an additional 5 weeks of benefits will be paid if the unemployed individual is enrolled in a job training program.”

Rosemary Elebash, state director for the National Federation of Independent Business (NFIB), says the new law addresses a problem for her members in a way that helps everyone.

“This bill was a top priority for NFIB/Alabama members,” she said. “The number one problem facing Alabama small/independent business owners is the lack of a skilled and qualified workforce. For more than one year, NFIB members across the nation have cited this as the number one problem they face.”

According to Elebash, the NFIB Small Business Economic Trends reported in April that 57% of small/independent businesses were hiring or trying to hire but 49 percent reported few or no qualified applicants for positions they were trying to fill. Among those, 32% had openings for skilled workers and 15% had openings for unskilled labor.

“This new Alabama law is unique among states that have reduced the number of weeks to draw unemployment by offering five additional weeks to draw if the applicant is attending an approved training program,” Elebash observed. “With over 600 programs available for applicants to choose from, the opportunities for those unemployed to improve their skills and increase their quality of life for their families and provide businesses with the needed workforce.”

Garrett believes each of the changes implemented by the legislature will produce gains throughout Alabama’s economy.

“All of these will positively impact the state’s economy and business climate and will result in unemployed individuals returning to the workforce sooner than now,” he said. “The new law is a win-win-win for individuals, businesses and the state of Alabama.”

Tim Howe is an owner and editor of Yellowhammer News