Cyclical System Puts Costs on Employers Now

Re: “Jobless Benefit Costs to Increase” (Dec. 17):

As chairman of the state Senate Committee on Labor and Industrial Relations, I too am concerned about keeping our economy healthy and I understand the importance of keeping small business strong.

The story noted that “with most employers paying an additional $21 per worker next year, the increase comes at a time when companies already are struggling” with other costs.

It fails to include the fact that when these unemployment laws were created, California businesses didn’t complain about the cyclical system of payment that creates this situation.

Under the cyclical system, employers pay the lowest rates in boom years when unemployment is low. But in order for the system to stay financially afloat, employers have to pay the highest rates in recession years when there is higher unemployment.

The system was very popular during the last six years while employers saved more than $4 billion due to lower employer contribution rates.

Complaining now is like refusing to pay the credit card bill in January after a flurry of holiday overspending.

And let’s keep this in perspective. The increase amounts to less than one penny per worker hour.

State Sen. Richard Alarcon

Sacramento