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Three Trends to Watch in the Unemployment Insurance Industry in 2023

Unemployment insurance (UI) is an integral part of the Labor and Employment industry, and it's been a challenging few years for state workforce agencies in the U.S.

Tech layoffs and rumors of a recession loom large. Since there's much uncertainty in the market, I've reached out to my colleagues and peers in the industry to try and get a sense of what's on their radar.

I hope these insights will enable your organization to better plan, prepare, and react to developments as they unfold.

Here are my takes on what to watch for in 2023.

Compliance with Federal Measures

During the height of the COVID-19 pandemic, the federal government allowed Unemployment Insurance (UI) agencies to forego federal measures due to the high influx of claims.

During this time, some agencies received more claims in a few days than they had previously received in a few months (or, in some cases, years). The federal government relaxed these standards to provide state UI programs with much-needed time to regroup, update their systems and processes, and work on meeting this surge in claims.

Now that times have changed and things have begun to look normal, I encourage agencies to begin preparations to ensure compliance with federal measures once again.

Agencies must work through their claims backlog, especially in preparation for DOL assessments. Performing well on these is critical for receiving the necessary allocation of funds your agency needs for the upcoming year.

Data Analysis to Improve User Experience

Software systems are a wealth of information for UI programs. Your organization can pull critical metrics on claimants, internal processes, and disbursements. However, I believe a significant focus for this year will center on improving the users' experience by using the data analytics available from your system.

Expectations of software performance are increasing with every innovation. What claimants viewed as easy to use one year may be antiquated or outdated next year. Working to improve your website or user's software experience will be a critical point for this year as agencies work to provide greater service to members.

Ensuring Program Integrity

The most important theme this year for the UI industry will be program integrity, ensuring that bad actors cannot gain access to your system and every measure is being used to prevent the payment of fraudulent claims.

While this has always been a challenge, it's reached new heights following the pandemic. The Department of Justice is actively investigating and prosecuting instances of COVID-19 fraud, as well as other state and federal agencies. In fact, I expect the entire industry to be more vigilant as reports estimate the massive amounts of fraudulent payments following this historic time.

Preventing fraudsters from gaining access to your system is only one-half the challenge; the other is mitigating their damage if they breach your defenses. From initial risk assessments to security policy and control mapping, I strongly encourage you to work with your security personnel on updating your system's security.


These trends should serve as the agencies' primary focus for the year. But, as we've all learned, the unexpected can always happen. Choosing a software vendor that can help you adapt to changes and respond to obstacles is vital for your agency's success. If you have questions on how to pick the right one, feel free to email me, and let's discuss.


Topics: Labor and Employment