Governor John Bel Edwards revealed the state’s Unemployment Fund is on a path to run out of money in as little as seven weeks, if Congress doesn’t act soon.
President of the Louisiana Association of Business and Industry, Stephen Waguespack, says if the money runs out, it will mean an increased tax on businesses already struggling to stay open.
“And so, if the feds don’t strike some solution to create some safe-harbor or quite frankly cash for these unemployment trust funds across the country, then businesses are going to see taxes go up and that will trickle down to employees and cost of goods,” Waguespack told WWL First News.
The last of the federal enhanced unemployment payments will be dispersed by the end of this week.
That additional $600 to the states $247 created a difficult situation for business owners, because many restaurant workers are making more money unemployed than if they were working, and had no incentive to return to work.
“We do think some version of a phase down, or running some of those funds through employers so you recreate that employee-employer relationship as we start back up, is a smart reform to this benefit,” Waguespack said.
Governor Edwards said, if Congress does not act now, the state’s unemployment fund will dry-up in just seven weeks and the state will be forced to borrow the money from the federal government to replenish the unemployment fund.