Why New Jersey’s unemployment insurance system uses COBOL.

COBOL systems process trillions of dollars of transactions daily for the world’s largest banks, which are clearly not strapped for the cash they’d need to make upgrades. COBOL might be deeply uncool, but it’s hardly a dead language.

…States have been starved of funding they need for running their unemployment insurance systems, money that under the 1935 Social Security Act is supposed to come from the federal government. According to a 2017 presentation by the National Association of State Workforce Agencies, the federal funding available for state unemployment insurance agencies to upgrade their technology, pay workers, and cover other administrative expenses has been falling steadily for the past 25 years, dipping roughly 30 percent below mid-1990s levels. In a survey NASWA conducted of 40 states’ workforce agencies, more than half of respondents said their administrative budget shortfalls were either “serious” or “critical.” And things haven’t gotten better in the years that followed, with Congress making further budget cuts in 2018 and 2019. Even compared with other social safety net programs, the technology used for unemployment insurance is in particularly bad shape. They have “some of the most antiquated and least versatile computer systems among public agencies,” said Indivar Dutta-Gupta, co-executive director of the Georgetown Center on Poverty and Inequality. While states that upgrade their Medicaid websites and tech systems have their spending matched 9 to 1 by the federal government, he said, states that want to fix their unemployment insurance get no such help.*

…According to Dutta-Gupta, Congress would have preferred to raise the percentage of lost wages that insurance would replace, instead of giving everyone the same boost, but the states said it would take five months or longer to change the reimbursement percentage.

…When it comes to our broken social safety net, COBOL isn’t really the bad guy: blame Congress for underfunding the programs, and states for failing to make up the gaps.

…It appears that a functional website sometimes goes hand in hand with a state government that prioritizes the safety net: Before Congress expanded UI, Florida provided only 12 weeks of unemployment insurance, while Massachusetts provided 30 weeks, and Massachusetts’ weekly benefit amounts were roughly 40 percent higher for middle-income workers than Florida’s.

Why New Jersey’s unemployment insurance system uses COBOL.



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