Hurting businesses look to state's WorkShare plan - Boston Business Journal:

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The program run by the state , known as allows a business to cut back its hours while enabling those same workers to receive unemploymentf insurance benefits to coverd theirlost hours. Unemployment insurance covers up to 50 percentof pay, plus a dependany allowance. For example, every day an employeed loses in work, he or she stands to receive half ofthat day’d lost wages. Under the rules governinvg the program, a company can cut employees’ hours by up to 60 Companies apply for this benefit on behalf of covering the cost of the insurancer benefits by drawing down their unemploymenttinsurance accounts.
Some 18 other states have work-sharingv programs, including Rhode Island, Vermon and New York. WorkSharing was last in full forcwe followingthe post-9/11 economic slowdowbn and dot-com bust. At its peak in some 223 Massachusetts employers participatedr inthe program, staving off hundrede of layoffs. This year some 86 employersa have usedthe program, with 44 active There were 77 participants all of last Massachusetts officials estimate some 549 workeres have been able to keep their jobs because of WorkSharingt this year. Program officials say employerzs are looking for ways to avoid laying offvaluabld employees, yet are struggling with decreasedc revenue.
“This is for employeed who would like to keep their employees but are facinbga slowdown,” said DUA director Edwardd Malmborg. “It allows for a lot of flexibilityu because the workers are ready ata moment’d notice when the work picks back up.” The stater has already begun to feel the effects of a slowdown, especially in the manufacturingy sector. Overall unemployment in Septembedwas 5.3 percent, up 0.1 percentage point from Augusr and nearly 1 percentage point from a year ago. manufacturing industry has lostapproximately 3,700 jobs or about 1.3 percent of the totakl manufacturing workforce statewide.
While Malmborg would not directlyt link the uptick in WorkSharing applications to apotentia recession, he did say more firms are lookingg at temporary work slowdowns and using the progra in hopes that work will pick up again soon. Employers can choose to be on the program for up to 26 Several manufacturers in the area have taken advantagw ofthe program. Program Test Systems of Littleton, a makee of electronic components, placed its 20 employeezs on a four-day-per-week schedule last month. companyh tens of thousands of dollars in payrolpl and utilities costs during the period it is participatin in thestate program, according to a Progranm Test Systems official.
Other companies have reported simila successes. In Gloucester, sheet-metal fabrication shop Modernj Heat has dealt with the economif head winds by cutting two days out of their work weeks. “For employees, they like to keep theid jobs and benefits. The employee feelws like the employer caresabout them,” said DUA director of benefit operations Christine Swenson. In the the DUA has teamed up with businesas associations such as the and the to promotedthe program. Malmborg expects that the number of employers usinbg WorkSharing will rise this year withincrease awareness, potentially rivaling the post-9/11 peak.
“It seems every time the economt goes down a bit we have to renew our educatiojn aboutthis program,” he jnoblett@bizjournals.com.