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ProPublica: Az's unemployment fund will be insolvent in six months
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Unemployment

ProPublica: Az's unemployment fund will be insolvent in six months

Despite low benefits, a spike in claims has put the state's program in jeopardy

  • A record 20 million Americans collected unemployment benefits in 2009.
    aflcio2008/FlickrA record 20 million Americans collected unemployment benefits in 2009.

This story was originally published by ProPublica.

ProPublica is a Pulitzer Prize-winning investigative newsroom. Sign up for The Big Story newsletter to receive stories like this one in your inbox.

The nation's unemployment insurance system, including Arizona's, is in crisis due to a combination skyrocketing unemployment and – in some cases – poor planning.

A Propublica research project found that a record 20 million Americans collected unemployment benefits last year, and 26 states have run out of funds and been forced to borrow from the federal government, raise taxes, or cut benefits. 

Arizona kept its trust fund afloat with a combination of low taxes and some of the nation's lowest benefits. The latest numbers had it at $102.6 million.

But a significant spike in claims at the beginning of 2009 quickly ate through most of the fund. The state has no tax increase planned for this year, and according to our calculations, the fund will be insolvent in less than six months.

The state's 9.1 percent unemployment rate was below the national average of 9.7 percent in December. The average weekly benefit is $218, ranking 49 out of the 50 states and Washington, D.C. With 42 percent of unemployed workers collecting benefits, Arizona ranks 33rd.

In many other states the situation is deteriorating fast. Using near real-time data on state revenues and the benefits they pay out, we estimate how long state trust funds will hold up.

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