GAO: Labor needs to share unemployment insurance lessons learned

The Department of Labor needs to comprehensively analyze and document challenges and lessons learned and distribute this information to each state to share and foster ideas for effective modernization of unemployment insurance systems, the Government Accountability Office said in a new report.

Labor’s UI program is a federal-state partnership that provides partial compensation for lost earnings of eligible individuals who become unemployed through no fault of their own.

In fiscal year 2011, about $117 billion was spent on the UI program. To administer the program, states rely heavily on IT, including benefits and tax systems. However, a July 2010 state survey noted that most of the UI IT systems are outdated and cannot efficiently handle their current workloads, according to GAO.

GAO analyzed documentation and interviewed officials from a non-generalizable sample of nine states, reviewed Labor policies and interviewed department officials.


The status of the states’ UI IT modernization efforts that GAO reviewed range from planning to deployment.

Of the nine states, three are part of a consortium (multiple states that develop a single common system) and are all in the initial planning phase. Two individual state efforts are in the development phase, two are in a combination of different phases, and two are in operations and maintenance.

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