Governor Evers Urges the Current Administration to Release Funds for State's Unemployment System

Friday, August 15th, 2025 -- 11:00 AM

(Joe Schulz, Wisconsin Public Radio) In the early days of the COVID-19 pandemic, when many businesses closed or laid off workers, a massive influx of 8.8 million unemployment claims overwhelmed Wisconsin’s aging unemployment insurance system. 

According to Joe Schulz with the Wisconsin Public Radio, that created a backlog of hundreds of thousands of claims. Many potential applicants weren’t able to connect to the department’s call center to complete the process and some Wisconsinites waited months without receiving a single unemployment payment.

Following those backlogs, the state has made strides to update the system and move away from outdated, decades-old computer systems, said state Department of Workforce Development Secretary Amy Pechacek.

She said DWD now has a digital portal for people to file unemployment claims and send documents online. The department also uses online chatbots to respond to questions in multiple languages, as well as uses artificial intelligence tools to assist with data entry.

“With these enhancements, the department is now paying 88 percent of all claims filed within three days or less,” Pechacek said. “That other 12 percent of claims that go a little bit longer are typically just because we have to do investigations if there’s some discrepancies between what the claimant and the employer are saying.”

In a letter to the current administration on Tuesday, Gov. Tony Evers said the administration is blocking nearly $30 million in federal funding to Wisconsin, which could prevent the state from finishing the project and potentially leave it vulnerable to cyberattacks and fraud.

“If the current Administration does not reverse course and provide the $29 million Wisconsin expected to receive, the state will not be able to complete its UI system modernization project,” Evers wrote to U.S. Labor Secretary Lori Chavez-DeRemer.

That funding was part of the American Rescue Plan Act, a pandemic recovery law signed by former President Joe Biden, and was being primarily used on anti-fraud measures, according to the governor’s office.

Evers’ letter says the U.S. Labor Department “suddenly terminated” the funding in late May.  The termination halted work on identity authentication tools, a digital employer portal, artificial intelligence enhancements, fraud-prevention and cybersecurity tools, according to Pechacek.

She said the employer portal was the DWD’s next major rollout and would have made it easier for employers to provide information to the state. “The employer portal is really one of the largest losses from this federal action,” Pechacek said.

“Our employers … have to submit quarterly wage information (and) verify claim information, and some of those components are still very antiquated.”

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