This onslaught of unemployment insurance claims the past two years have taxed the state's mainframe system, and the state Department of Labor and Workforce Development said it is making progress on a possible major redesign.
A consortium of four states, with Tennessee in the lead, has hired Chicago Systems Group-Government Solutions as a consultant on the redesign, a contract worth $2.8 million, said Don Ingram, state employment security division administrator. A proposal is expected in September 2011, and the states will request federal money to fund new systems, he said. Tennessee received $7 million last year for a variety of technology upgrades, which will help pay for the consultant.
A new unemployment benefit system could cost upward of $60 million. It would replace the state's antiquated mainframe with a server-based hardware and will allow for real-time processing instead of overnight delays typical now, Ingram said.RelatedJobs resources and tipsUpgrades needed
Meanwhile, the state has hired more workers, required more overtime and weekend work and bought more phone lines and servers to deal with higher volumes.
"We have to make upgrades more from a technology standpoint, not by just adding employees," Ingram said.
This year there have been 126,000 initial claims for unemployment, up 31 percent from 96,000 initial claims over the same period two years ago. Still, the volume of claims is sharply lower than the peak volumes seen last year at the height of layoffs and recession.
On average each week, some 160,000 unemployment checks are being sent out, which is down from a high of 180,000-plus earlier this year, Ingram said.
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