Labor secretary defends workforce investments, outlines plan to fix unemployment insurance delays
February 02, 2024 | Education, Business and Administration Subcommittee, Budget and Taxation Committee, SENATE, SENATE, Committees, Legislative, Maryland
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Emily Haskell, the Department of Legislative Services analyst, presented the Department of Labor's FY2025 operating budget and highlighted a departmental decrease overall but a $22 million increase in general funds driven largely by administrative costs for the Family and Medical Leave Insurance (FAMLI) program.
Secretary Portia Wu told the subcommittee the budget doubles down on workforce development priorities and defended maintaining $2 million for the Employment Advancement Right Now (EARN) program and $2 million for a new Talent Innovation Fund. "An independent evaluation found that for every dollar invested in this program, that leads to over $17 of economic impact in Maryland," Wu said, arguing the funding leverages private-sector partnerships and can expand training opportunities in cybersecurity and other high-growth fields.
Wu and Deputy Secretary Jason Perkins Cohen described apprenticeship growth (over 11,500 registered apprentices and a record number of youth apprentices) and said the budget adds positions and contracts for correctional education, including expanded internet infrastructure and tablets for classrooms.
On the Family and Medical Leave Insurance program, DLS and the department described implementation timing and staffing needs; the department said it will seek to delay contributions and benefit-claim start dates to allow more time for IT and rules development.
Committee questioning focused heavily on unemployment insurance (UI) performance. The department acknowledged slower claims-processing performance compared with pre-pandemic levels, reporting roughly 70 percent of claims paid on time versus about 90 percent pre-pandemic. Wu cited pandemic-era fraud and identity-theft challenges, manual review burdens, and an interim IT platform that needs further development. She described operational changes: reinstated in-person kiosks and in-office help at job centers, investments in fraud-detection tools, plans to stand up an in-house call center (current vendors are restricted by law from processing claims), and a new chief digital product officer to oversee customer experience.
DLS asked for clarification on YouthWorks Baltimore closeout coding; the department said that was an administrative coding error that did not impair the program or services to young participants.
The department also said it expects approximately $15 million in federal modernization and customer-service grants to support IT improvements later this year and that it will continue to request state support where federal funding does not cover administrative costs.
No formal committee action occurred at the hearing; DLS recommended deletion of $4 million in proposed workforce funding increases and asked the department to comment further on several budget items in follow-up submissions.
Secretary Portia Wu told the subcommittee the budget doubles down on workforce development priorities and defended maintaining $2 million for the Employment Advancement Right Now (EARN) program and $2 million for a new Talent Innovation Fund. "An independent evaluation found that for every dollar invested in this program, that leads to over $17 of economic impact in Maryland," Wu said, arguing the funding leverages private-sector partnerships and can expand training opportunities in cybersecurity and other high-growth fields.
Wu and Deputy Secretary Jason Perkins Cohen described apprenticeship growth (over 11,500 registered apprentices and a record number of youth apprentices) and said the budget adds positions and contracts for correctional education, including expanded internet infrastructure and tablets for classrooms.
On the Family and Medical Leave Insurance program, DLS and the department described implementation timing and staffing needs; the department said it will seek to delay contributions and benefit-claim start dates to allow more time for IT and rules development.
Committee questioning focused heavily on unemployment insurance (UI) performance. The department acknowledged slower claims-processing performance compared with pre-pandemic levels, reporting roughly 70 percent of claims paid on time versus about 90 percent pre-pandemic. Wu cited pandemic-era fraud and identity-theft challenges, manual review burdens, and an interim IT platform that needs further development. She described operational changes: reinstated in-person kiosks and in-office help at job centers, investments in fraud-detection tools, plans to stand up an in-house call center (current vendors are restricted by law from processing claims), and a new chief digital product officer to oversee customer experience.
DLS asked for clarification on YouthWorks Baltimore closeout coding; the department said that was an administrative coding error that did not impair the program or services to young participants.
The department also said it expects approximately $15 million in federal modernization and customer-service grants to support IT improvements later this year and that it will continue to request state support where federal funding does not cover administrative costs.
No formal committee action occurred at the hearing; DLS recommended deletion of $4 million in proposed workforce funding increases and asked the department to comment further on several budget items in follow-up submissions.
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