New labor commissioner tackles unemployment amid money crunch

At least his new job is not boring.

As state labor commissioner for just a month, Mark Butler is trying to figure out:

Mark Butler

Mark Butler

– How to help reduce Georgia’s double-digit jobless rate;

– How to repay a $620 million federal loan, which could lead to higher employer taxes for unemployment insurance;

– And how to preserve two popular jobs program that are under the gun because of the state’s fiscal crunch.

“I don’t think anyone likes crises. It’s a tremendous challenge. I enjoy a challenge,” said Butler, a former state representative for Carroll and Haralson counties, who worked in his family’s real-estate appraisal business.

If Butler, 40, truly enjoys challenges, he’s going to have a ball. Georgia’s job market has been worse than the nation’s for well over three years now — and there’s no end in sight for that depressing streak.

To try to attract new jobs, Butler said he will increase the coordination between his department and those involved in trying to recruit new companies. That includes the state’s Economic Development Department and local business and government leaders.

“We’re going to be there to help them with their pitch,” Butler said. His department can provide meaningful employment data to the execs making relocation decisions, he said.

If taxes are on those execs minds, they may want to know that unemployment insurance taxes could rise next year. Given our consistently high unemployment rate, Georgia’s unemployment insurance fund has had to borrow money from the federal government, as have many other states’ funds.

To repay the money and get out of the red, employer tax rates for unemployment insurance could increase next year by as much as 49 percent, or $93 a year per employee for the average employer.

“We’re trying to come up with a way to manage its effect on business,” he said. “All solutions are a tough pill to swallow.” The pill could include issuing bonds, he said, or other options that are being discussed with the governor’s office. That could reduce the size of the tax increase.

Speaking of the governor, Butler is hoping to convince him to maintain the department’s vocational rehabilitation budget. It helps those with disabilities — nearly 37,000 people — and represents about half of the department’s $450 million budget. Cutting this program may be counterproductive. For every $1 the state cuts, it will lose $4 from a federal government match.

Also under the knife is the popular Georgia Works program, which Butler already has scaled back because it became too successful for its budget allocation. The program pairs the unemployed with employers, who do not pay workers during a training period that often leads to permanent jobs. The workers can collect unemployment insurance and a stipend.

To save more money, Butler will be streamlining other operations, as he attempts to justifhis budget to House and Senate budget writers. He’s hoping to hold on to all 31 safety inspectors, who are responsible for elevators, escalators and amusement park rides.

“We understand it’s a hard time now,” Butler said. “There very well may be layoffs.”

In this economy, no one seems immune.

- Henry Unger, The Biz Beat

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