A Guide to Immediate and Long-Term Fixes to the Unemployment Benefits Process

A sign outside of the Massachusetts Unemployment Office. Unemployment claims are severely straining the legacy systems states use to process them.

A sign outside of the Massachusetts Unemployment Office. Unemployment claims are severely straining the legacy systems states use to process them. AP PHOTO/Michael Dwyer


Connecting state and local government leaders

COMMENTARY | State unemployment systems are in need of significant short and long-term solutions to handle the exponential increase in unemployment claims that have occurred as a result of the Covid-19 pandemic.

States are facing unprecedented numbers of unemployment claims and these legacy agency systems— many of which date back to the 1970s and 80s—simply cannot handle the volume.

Only 16 states have fully modernized unemployment systems, says Michele Evermore, senior policy analyst for the National Employment Law Project. And several states still use COBOL, a 60-year old programming language, to power their systems.

Adding to the challenge is that states have had to quickly shift to remote work operations to keep their employees safe, while meeting the urgent needs of the constituents they serve. Processing unemployment claims still requires a significant number of paper-based documents like pay stubs, wage records and proof of residency. This is on top of the fact that agencies still print and store unemployment records in physical form on the backend. With the large volume of paper and data needed to support the claimant management system and process, agencies need to consider a new approach.

Steps to a Modernized Claims Processing System

Agencies are struggling to understand how they can most effectively serve residents applying for unemployment with their staff working remotely and unable to accept paper-based documents. Additionally, many claimants don’t have the capability to produce and submit digital records. And those that do run into problems with government systems that aren’t mobile-device friendly. Agencies are now challenged with receiving and distributing claimant information—digitizing and indexing—while protecting the security and privacy of the claimant.

Agencies need to adopt a staged approach to revamping their unemployment programs by first focusing on the short-term goals of resolving the current backlog and improving documentation accessibility and management. And for long-term future success, agencies will need to modernize their systems.


In the near-term, agencies should focus on their ability to get their constituents the benefits they need during these trying times by instituting the capabilities below.

  • Digitization: Teleworkers need access to critical information of claimants. Building a digitization capability that includes scanning, indexing and digital storage into a cloud repository will help with distributing the workflow.
  • Cloud Computing: Enabling a secure transfer of electronic images and records to an agency’s content management system will immediately provide the assets required by remote staff to quickly, securely and accurately review and administer claims.
  • Secure Storage: Pursuing a method to store records, both physically and digitally, at third-party facilities where support can be provided more safely, and the records stored—either for a limited time or long-term—allows for a more efficient program.
  • Destruction: Again, partnering with a third-party that is actively working can help ensure physical records continue to be securely destroyed as legally required.

These capabilities will also help agencies take a step toward modernization.


Once the core capabilities are in place to help citizens in the near-term, agencies have an opportunity to institute more modern systems, infrastructure and processes that sets them up to support constituents in the future. As part of this effort, agencies should look at the following:

  • Information Governance:  Implementing information governance frameworks to include identifying where records and data are located and stored, as well as who is responsible for managing those records, is important. An in-depth assessment will help prioritize areas that need to be addressed first. This should be followed by an inventory of what systems, applications and repositories exist already, where they are located and what type of data is stored within them. With this in place, agencies will be able to leverage that information more effectively with internal and external stakeholders and have more insights into its value as an asset. Additionally, it will help agencies better adhere to state and federal retention policies, while providing a more secure environment.
  • Workforce Automation: By incorporating automation technology, agencies can alleviate some of the manual requirements that make the benefits claims process so inefficient and cumbersome, such as the digitization of hard copy files, manual entry of information into electronic systems and the disposition of documents. This starts with capturing information at creation, managing and accessing that information effectively, integrating automation into business processes, and measuring and storing what is needed. It simplifies content-heavy processes such as benefits administration and can help agencies focus on the most critical components of the workflow.
  • Artificial Intelligence (AI):  When it comes to the ability to generate insights from the data, AI and machine learning-based classification of physical and digital records will help agencies add structure, context and metadata that will increase the overall usability of information and preventing data silos from forming. Classified and tagged data can support enhanced automated governance and workflow throughout the claims process, allowing agencies to more efficiently conduct searches, track requests, determine eligibility and deliver benefits. Ultimately, this provides a more streamlined capability for ingesting and managing the significant volumes of information associated with the claims process.
  • Information Security:  The large volumes of claims data and associated personally identifiable information also exposes individuals to additional risk. Agencies must mitigate this risk by securing how information is accessed, stored and destroyed. Following a proven chain of custody program is also important to ensure that records are protected when transported.

While a majority of unemployment claims flow through a state’s platform and auto-adjudicate, a large volume of exceptions can easily consume existing staff. The approach outlined above can help agencies deliver benefits more efficiently now and in the future.

Mary Ellen Buzzelli is the director for state, local and education strategy at Iron Mountain Government Solutions.

NEXT STORY: You Can See Friends and Relatives During the Pandemic Surge—But Do It Carefully