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Maryland labor secretary flags long-term solvency risks, urges consideration of taxable wage-base changes
Summary
In a Feb. 4 briefing, Secretary Wu told the Economic Matters Committee that Maryland's UI trust fund is above the AHCM solvency benchmark now but faces long-term decline without structural changes; she highlighted the low $8,500 taxable wage base (last updated 1992) and projected pressures from rising wages and potential recession.
Secretary Wu told the Economic Matters Committee on Feb. 4 that while Maryland's unemployment insurance trust fund is currently above the average high-cost multiplier (AHCM) solvency benchmark, long-term pressures could shrink balances unless structural changes are made.
Wu explained that the AHCM is a benchmark indicating whether a state has enough in its trust fund to pay a year of benefits in a typical recession; being above 1 preserves the state's ability to borrow interest-free from the federal government during severe drawdowns. "As long as you have been recently maintaining…
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