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October 5, 2010 Jay Finegan, 287-1445
Rep. Bickford submits bill to spur private sector employment

AUGUSTA – State Rep. Bruce Bickford has submitted legislation designed to put 3,200 unemployed Mainers back to work in private sector jobs. The plan, modeled on one used successfully in Utah, involves wage subsidies for each qualified employee hired and retained for three months – $500 during the first month and $1,500 after three months of employment.

The bill – “An Act to Establish the Maine Back to Work Program” – was introduced for the upcoming 125th Legislature. It has been submitted to the revisor’s office, the unit that drafts bills for legislative action.

As currently envisioned, the program would provide wage subsidies for some 2,500 Mainers who made $15 per hour or less at their last job and are currently receiving unemployment insurance benefits. An additional 700 slots would be reserved for unemployed 18- to 24-year olds.

“We would start with 3,200 people and monitor the program as it unfolds,” said Rep. Bickford (R-Auburn), a member of the Labor Committee. “If it looks successful, it could be expanded. The state would provide the subsidies, and in theory the state would save money by avoiding those unemployment payments and having folks back working and paying taxes. I would like to see the fiscal note reflect those dynamics.”

According to the Maine Department of Labor (DOL), the maximum unemployment benefit is $359 per week. The average weekly benefit statewide is $283. Benefits are based on prior earnings. The DOL distributed 26,821 benefit checks for the week ending September 25, but the department said Maine’s official number of unemployed is about 49,000.

To be eligible for the wage subsidies, employers must meet certain criteria, including paying the new hires at least $9 per hour as a starting wage and guaranteeing at least 35 hours of work per week. They may not replace or partially replace existing employees. Temporary help companies, professional employer organizations and government employers are not eligible. The program would end when the funds dedicated to it run out.

“The goal is to get folks back to full-time private sector employment, not a temp job or a government job,” said Rep. Bickford. “This won’t solve our unemployment problem by itself, but it could make a real difference for a few thousand people.”