Hoosiers might be surprised to learn that in 2012, the 112th Congress agreed on at least one thing; The Middle Class Tax Relief and Job Creation Act of 2012 – which included provisions to expand work-sharing policies in the U.S.
This provision saved a whopping half-million jobs during the recession – with less than half of all states using it during that time.
Indiana’s delegates supporting the act included Sen. Richard Lugar and Reps. Marlin Stutzman, Joe Donnelly, Andre Carson, Larry Buschon, Todd Young and now Gov. Mike Pence.
Since its passage, work-sharing policies have been adopted and supported by Republican and Democratic governors (including Michigan and Ohio), business and labor, and conservative and progressive economists.
Now used in more than half of U.S. states, work-sharing provides employers with the option of temporarily reducing the hours and wages of all employees instead of laying off all workers.
Hoosiers might also be surprised that broad bipartisan support exists in Indiana as well. Here’s why:
For workers, the program acts as the front line defense against joblessness. Workers would earn higher wages than they would under traditional unemployment, and they would retain health and retirement benefits.
For business, work sharing offers flexibility during economic downturns. Providing a tool for business to retain a skilled workforce is why Gov. Rick Snyder supported recent legislation in Michigan – a smart move for states interested in closing skills gap.
Finally, work-sharing has the real potential to chip away at Indiana’s Unemployment Insurance Trust Fund deficit. The program, according to our survey of states with work sharing programs, is either cost-neutral to the state’s unemployment insurance trust fund, or has produced savings. This analysis does not even take into account the federal government’s implementation and outreach grants, along with its reimbursement period. The latter could save the state millions.
So why, after three years’ worth of legislative efforts, does the Indiana General Assembly continue to fail to protect Hoosier jobs?
From the Indiana Chamber of Commerce: “…the bill was scratched from the Employment, Labor and Pensions Committee schedule by its chairman, amid opposition from the Department of Workforce Development and belief the governor was not yet on board with the program – despite voting for the federal work share bill when he was in Congress.”
It’s mathematically reasonable to assume another downturn is right around the corner. With work-sharing, forward-thinking lawmakers can implement this bipartisan, cost-friendly and common sense solution immediately to, as the saying goes, start to fix the roof while the sun is (relatively) shining.