Oregon moved more slowly than most states addressing the deluge of jobless benefits claims during the early months of the coronavirus pandemic, with tens of thousands of laid-off workers routinely waiting weeks or months for their money.
While every state struggled to pay benefits during an unprecedented wave of layoffs last spring, Oregon appears to have been exceptionally slow. The state was often less than half as likely to pay claims within the standard, three-week federal benchmark for timely payments than the national average, according to a new analysis of federal data by The Oregonian/OregonLive.
Oregon was playing catch-up all year long, even as many people’s financial circumstances deteriorated. Among long-delayed claims nationwide, Oregon was among the very slowest, according to data collected by the U.S. Department of Labor.
In August, for example, more than a third of people who received their first benefits payments had waited at least 70 days. That’s a higher share than any other state and is consistent with Oregon’s ranking in other months.
Additionally, the federal agency says Oregon is the only state that has yet to pay claims for the first week after workers lost their job, the so-called “waiting week.”
Oregon owes hundreds of millions of dollars to workers who lost their jobs between March and August and department head David Gerstenfeld says he doesn’t expect to make the payments before the end of November, eight months after Congress authorized the federal payments.
The Oregon Employment Department says the federal timeliness data overstates Oregon’s delays relative to other states. That’s partly because the numbers don’t account for backlogs of unpaid claims still accumulating elsewhere, and partly because Oregon has focused on paying the oldest claims first – which makes it appear the state has an unusual share of delays.
Yet Oregon’s response data remained consistent throughout the spring and summer, regardless of the length of the payment delay, and were always at or near the bottom of the national rankings.
“I’m very, very frustrated with them. It really brings tears to my eyes,” said Jill Heininge, 37, of Tualatin. She left her job as an addiction counselor in March when her kids' daycare shut down and exhausted her savings during the summer while scraping by and caring for three young children before returning to work recently.
The department notified her last spring that it had denied her claim, pending more information about why she was out of work. Like many other Oregonians, Heininge called and emailed the department regularly but received no response until Thursday, when she received a voicemail from the Oregon Employment Department indicating it was now ready to look at her case.
“It’s really crappy that they do this to people, you know?” Heininge said. She said she believes the department owes her $10,000 in benefits.
“I know that they have a lot of people they take care of,” Heininge said, “but they need to have a better process of how they communicate with people.”
Oregon has paid well over $5 billion in unemployment benefits since the state’s coronavirus shutdown began in March, and it now processes new claims almost immediately. But 48,000 people are still waiting to have old claims adjudicated and it could take months for the state to work through the backlog.
The source of Oregon’s problems is well understood. The employment department suffered from a decade of dysfunction that prevented the state from replacing obsolete computers from the 1990s, even though it received $86 million to fund a technology overhaul in 2009 (the state still has nearly all that money.)
Each of the employment department’s last three directors have been fired or asked to leave, most recently in May when Gov. Kate Brown replaced Kay Erickson as department head.
The new analysis of federal data suggests that Oregon moved more slowly, at least initially, than many states in paying claims:
- Before the pandemic, Oregon was paying nearly every jobless claim within the three-week benchmark for timely payments. By August, just 31% of claims were paid during that period, half the national average.
- Of claims paid in August, Oregon had the highest share nationwide of claims delayed at least five weeks.
- In September, Oregon ranked behind every state except for Kentucky for timely payments at 36%. (A few states have yet to submit September data.)
“I’m not surprised and in some strange way I guess I’m relieved to know there aren’t places worse than Oregon, with people having even more miserable experiences,” said Sen. Mark Hass, D-Beaverton, who was critical of the employment department during legislative hearings last summer.
Like other lawmakers, Hass said his office has been besieged by calls and emails from constituents who had been unable to secure their unemployment benefits. He has proposed a major overhaul to the employment department, suggesting that Oregon combine it with the state’s economic development agency.
“My hope is that they set up a task force or a commission to revamp the entire department,” Hass said. “Give it a new name, give it a new mission, put some people in there who are change agents who understand their mission.”
Gerstenfeld, the agency head, said the federal data on timely payments doesn’t accurately reflect how the state is performing now. He said Oregon’s historical numbers are skewed because they obscure claims in other states that have gone completely unpaid, and because Oregon decided to prioritize oldest claims.
“I don’t think it shows that Oregon has been at the bottom of the pack for everything throughout,” Gerstenfeld said.
Like other states, Oregon was walloped in the initial days of the pandemic – receiving as many jobless claims in a few weeks as it ordinarily does in an entire year. Since then, Gerstenfeld said the state has made steady progress in reducing the number of people waiting for their benefits.
“The backlog absolutely was growing. It absolutely was growing and it was growing dramatically in March and April. And it took a lot of effort to start bringing that back down,” Gerstenfeld said. He said the federal data is an incomplete picture, and doesn’t reflect the progress the state has made in catching up even as other states continue to add to their own backlogs.
The employment department has made demonstrable progress since the early months of the pandemic, even though it doesn’t show up in the federal data. That’s because the data shows how long people had to wait to have past claims paid, not how quickly newly filed claims are being paid now.
Gerstenfeld said that new claims now are typically being processed within a few days or – on the outside, within a couple weeks. He said some states are still adding to their backlog while Oregon is steadily chipping away at its.
“As long as we’re focused on doing the oldest claims first, we will keep paying those and those will keep making those numbers look bad,” Gerstenfeld said.
He added that Oregon moved relatively quickly to implement some new benefits programs this year, notably the $600 weekly bonus payment Congress approved in March, and a temporary $300 weekly benefit that began in August. (Both those benefits have since expired.)
However, Gerstenfeld conceded the Oregon is the last at paying the waiting week, which means many thousands of Oregonians have been waiting for months for federal payments of at least $800 apiece. The department says it’s on track to pay the waiting week by the end of November, but if it misses that target – and doesn’t make the payments by the end of the year – Oregon risks forfeiting hundreds of millions of federal dollars earmarked for laid-off workers.
“I don’t dispute Oregon is at the bottom of the list for getting the waiting week paid,” Gerstenfeld said.
Reed College political science Professor Chris Koski said government agencies that have problems during good times are going to have those problems exacerbated during bad times. And he said an agency like the employment department, which most citizens interact with episodically, often doesn’t receive the oversight necessary to identify and eliminate problems before a crisis hits.
“Attention is not really paid to them very much by legislatures during good times,” Koski said. “This kind of allows workplace cultures to get embedded and there’s not a lot of oversight.”
Yet Koski said there seems to be something distinctive about Oregon that prevents it from fixing chronic problems, or successfully tackling big new initiatives. He points to the state’s underperforming educational system and the failed Cover Oregon healthcare portal, among other examples.
States that are dominated by one political party – whether it be Democrat or Republican – often lack the competitive drive to find and identify longstanding issues, Koski said. Or perhaps Oregonians are too focused on electing leaders who make big promises about addressing high-profile topics and are less inclined to put forward politicians with the aptitude and interest to ensure government agencies perform their basic functions well.
“It’s not as if we don’t have a tax base to deal with that sort of thing,” Koski said. “There’s something else going on.”
-- Mike Rogoway | twitter: @rogoway | 503-294-7699