Virginia Commission proposes emergency measures to strengthen unemployment insurance program

The Virginia Commission on Unemployment Compensation convened on May 19, 2025, to address critical issues surrounding the state's unemployment insurance (UI) program. With the federal government unlikely to provide additional support during economic downturns, the commission emphasized the urgent need for Virginia to strengthen its UI system through both permanent and emergency measures.

The meeting highlighted the role of UI as an automatic macroeconomic stabilizer, which helps maintain household spending during periods of joblessness. However, current benefit amounts and durations are insufficient to provide adequate protection against economic declines. Historically, the federal government has stepped in during recessions to extend benefits, but with current federal spending cuts, Virginia must take proactive steps to safeguard its economy.

Commission members discussed several key recommendations, including extending the duration of benefits to at least 26 weeks, a practice already adopted by ten other states. They also proposed expanding eligibility for UI, enhancing reemployment services, and establishing navigator programs in partnership with community organizations. Increasing staffing at the Virginia Employment Commission (VEC) was suggested to better manage these initiatives.

Furthermore, the commission noted that raising UI benefit amounts could attract additional federal funding. For instance, higher UI benefits would also increase disaster unemployment assistance (DUA) rates, which are tied to regular UI benefits. This connection was illustrated by North Carolina's recent executive order to raise UI benefits following Hurricane Helene, which also waived employer charges for regular UI claims during the disaster.

In conclusion, the commission's discussions underscored the pressing need for Virginia to enhance its unemployment insurance program to better protect workers and the economy in the face of potential future recessions. The proposed measures aim to ensure that all unemployed workers receive adequate support, thereby stabilizing the state's economy during challenging times.