PROVIDENCE – As state unemployment claims continue to rise, the money available to pay out benefits is going down.
The state’s insurance trust fund had $391 million available as of Friday, down more than 25% from the $529 million balance in early March prior to the onset of the COVID-19 pandemic, according to R.I. Department of Labor and Training spokesperson Angelika Pellegrino.
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Exactly how long before the funds run out, Pelligrino declined to comment – but at this point, it’s a question of when, not if. While Rhode Island’s insurance trust fund was in better condition than other states prior to COVID-19, it fell shy of the minimum level of solvency recommended to weather a recession, according to an analysis by the Tax Foundation.
And while the number of new unemployment claims filed each day has slowed substantially since March, the state’s 17% April unemployment rate – 3.7% higher than the national average – suggests the length and severity of this recession will be more dire than what even a minimum recommended solvency could cover.
Pelligrino said the department will not be surprised when the time comes to borrow from the federal government to continue paying out unprecedented claim levels.
Nancy Lavin is a staff writer for PBN. Contact her at Lavin@pbn.com.
