Massachusetts Governor Works to Prevent Outsourcing of Jobs

Says unemployment insurance reform necessary to preserve, protect jobs

by / March 5, 2004
Gov. Mitt Romney called on members of the Legislature's Joint Committee on Commerce and Labor to help him stem the outsourcing of jobs from Massachusetts to other states and nations.

"In Massachusetts, we are losing jobs to other countries and other states," Romney said. "Manufacturing jobs have fled from Massachusetts for decades. But the new wave of outsourcing is particularly alarming because it involves the very jobs that replaced those jobs that were lost."

He added, "Now we are seeing the loss of highly skilled manufacturing positions we believed were secure. We are seeing outsourcing in clerical, financial services, accounting, engineering, software and other areas. The promise that education is a sure road to job security is very much in question."

Romney said bringing unemployment insurance costs more in line with other states will stem the tide of outsourcing and help preserve and protect jobs in Massachusetts.

"I am fighting to bring new jobs to Massachusetts and to keep the ones we have here," Romney said. "If the Legislature fails to reform our unemployment insurance system, if it fails to bring it into line with all the other states in America, you will not see jobs come here, you will see them leave here."

Romney's proposal to reform the unemployment insurance system will immediately reduce the cost on businesses by lowering the "wage base" from $14,000 to $12,800. It will also eliminate the mandatory surcharge on businesses, which could place an unlimited and unpredictable assessment on each job in the state if the unemployment insurance fund is going insolvent.

The plan will provide approximately $120 million in immediate cost savings to employers, resulting in an incentive for job retention and creation.

In addition, Romney's bill proposes benefit reforms that will bring Massachusetts in line with other states, including:

  • Providing up to 26 weeks of unemployment benefits, which is the same level offered by every other state in the nation, instead of the current 30 weeks;

  • Offering benefits to individuals who have worked for at least 20 weeks, instead of the current 15 weeks; and

  • Redefining the "average weekly wage" to a more reasonable standard by basing it on four quarters of earnings with the three highest quarters being double weighted.

"We need to get the balance right," said Romney. "We have an opportunity to work together to reform the system so that Massachusetts continues to provide the best benefit package in the country, but at the same time lessens the cost of retaining and creating jobs in the state."