Unemployment Benefits Disrupted by Tech Issue in 22 States

by Maurie Backman | Updated July 25, 2021 - First published on April 27, 2021

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A line of people standing in front of a building labeled Job Center.

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Unemployment has been a lifeline during the pandemic, but some people are being denied benefits for a ridiculous reason.

Millions of Americans have lost their jobs in the course of the coronavirus pandemic, and many have exhausted their savings accounts just trying to stay afloat. The result? Those who remain jobless have been heavily reliant on unemployment benefits to pay their bills. But a technical glitch is causing some people to be denied the unemployment income they need.

When tech troubles cause financial troubles

The pandemic has been raging for over a year now, and while the jobless rate has, thankfully, steadily declined since peaking last April, there are still millions of Americans who remain out of work. And those people rely on their unemployment benefits to cover basic expenses.

But because unemployment fraud is such a big issue, many states have their own verification systems to ensure that benefits go to the right people. It's a good idea in theory -- except when things break down.

Such may be the case in an estimated 22 states. Each state operates its own unemployment system, and many have partnered with a program called ID.me, which helps states verify that applicants are who they say they are. The problem? Like all software, ID.me has the potential to glitch, and that's precisely what's been happening in many corners of the country.

The result is that some people who are entitled to unemployment benefits aren't getting their money. Instead, they're being forced to put off bills and rack up costly debt.

Compounding the problem is the fact that most states' labor departments or unemployment benefits administrators aren't equipped to help claimants deal with technical issues related to ID.me. Not only do states not have access to ID.me's backend system, but many state employees aren't trained in how to help people work through issues. As such, many people who need unemployment have gotten stuck in a vicious loop of being denied their money -- and having no one to turn to for assistance.

Now to be fair, ID.me has been shown to be effective at preventing fraud. In fact, the Colorado Department of Labor and Employment (CDLE) says that more than $91 million in unemployment has been released to legitimate beneficiaries as a result of the ID.me verification system.

What's more, the CDLE says that of 1,134,126 unemployment claimants who have been asked to use ID.me since January, only 137,027 identities have been verified. This leads the department to believe that most of those claimants were criminals seeking to steal money they were never entitled to. But that doesn't negate the fact that technical issues have locked legitimate claimants out of the system -- people who may be growing increasingly desperate by the day.

Those who are having issues with ID.me can consult ID.me's list of tips to help troubleshoot their problems. But if that fails, the next step is to contact ID.me directly to see if the company can step in and provide some assistance so that their much-needed benefits can finally be released.

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