U.S. Senator John Thune (R-S.D.) today introduced the Solutions to Long-Term Unemployment Act (S. 2038), which would address long-term unemployment by reducing the cost of hiring and providing relocation resources for long-term unemployed individuals, as well as strengthening and streamlining federal worker training programs. Thune’s bill mirrors the amendment he offered as an alternative to S.1845, the Democrat’s unemployment insurance extension bill, which would extend emergency unemployment compensation for the 13th time since 2008.
“There are 3.6 million Americans who have been unemployed for six months or longer,” said Thune. “We need to do everything we can to make it easier and less expensive for these men and women to find jobs. Jobs are the key to a future of opportunity, prosperity, and security. No matter how you spin it, no matter what government benefit you try to throw at it, there is no substitute for a job. Congress needs to start working on real solutions that will create jobs, better train America’s workforce, and break the cycle of chronic high unemployment. That’s why I hope my colleagues will support my legislation to start tackling the causes of our long-term economic problems, instead of simply treating the symptoms.”
Thune’s bill would:
1) Exempt long-term unemployed individuals from the Affordable Care Act’s mandate for certain businesses to provide health insurance or pay a fine for each uninsured employee. If an employer hires a long-term unemployed individual, that worker is permanently exempt from the Affordable Care Act full-time employee count for as long as he/she is employed by that employer. Under the Affordable Care Act, businesses with 50 or more employees must provide government-approved health insurance or pay a fine of up to $3,000 per employee.
2) Enact a six-month employer-side payroll tax holiday for each long-term unemployed individual hired. Each employer is responsible for a 6.2 percent payroll tax for each worker. For an employee hired with a $40,000 salary, that represents a $1,240 incentive to hire a long-term unemployed individual, which will help break the cycle of unemployment for those millions of Americans who have been out of work for 27 weeks or longer.
3) Provide a one-time, low-interest loan up to $10,000 for a long-term unemployed individual to relocate more than 50 miles away to start a new job or to relocate to a new state or metropolitan area with an unemployment rate that is at least two percentage points less than the individual’s current state or metropolitan area. These loans must be repaid with interest within 10 years. However, no repayments would be required for one year, and if the job is eliminated through no fault of the employee, the loan may be forgiven. Part of a dynamic, mobile workforce is ensuring that those who have been out of work the longest have the resources to relocate for better job opportunities.
4) Streamline and improve job training by including the House-passed SKILLS Act (H.R. 803) which would consolidate 35 federal employment and training programs and create a Workforce Investment Fund to serve as a single source of support for employers, workers, and job seekers at the state level. There are over 50 federal worker training programs across nine federal bureaucracies. Many are redundant and most have not been evaluated for efficacy. Streamlining these programs and empowering state governors to better manage worker training initiatives will benefit employers and prospective employees alike and will particularly help those who have been unemployed the longest.The payroll tax holiday and the relocation assistance in Thune’s bill would expire two years after enactment or one month after the total number of long-term unemployed drops below two million. The provisions would be offset by lowering the 2015 non-defense discretionary spending caps by $10 billion to $483 billion, which would be a reinstatement of the non-defense caps for 2015 under the Budget Control Act.