NY pays off $8B unemployment debt, easing business costs

In my ‘On Business’ column on March 19, I discussed the need to pay off New York State’s unemployment insurance debt and the huge impact this debt has had on every business across New York State. Today, I am excited to share that Governor Hochul has stepped up alongside allies in the legislature to use $8 billion of New York State’s reserve fund to pay off our state’s unemployment insurance debt to the federal government and restore the fund’s solvency.

Greater Rochester Chamber has been a vocal advocate on this subject each year since the pandemic began. Since this debt was taken out, it has been one of our top lobby priorities, and we have relentlessly urged the state to pay off this debt and remove the terrible impact on our business community. This is for the good of all businesses across our state, but its impact is felt profoundly here in Greater Rochester. To share an example of the scale of how businesses were impacted, one of our region’s larger employers paid over $700,000 last year.

When you imagine the collective impact on all businesses from mom-and-pop shops up to our major corporations, this unemployment insurance debt has had a dramatic and negative impact on balance sheets across our state. Just here within the Greater Rochester nine-county region alone, New York State Department of Labor reported 568,400 employed individuals in the workforce as of April 2025 — and employers in our area will be saving hundreds of dollars in tax liability and surcharges for every single one of these hundreds of thousands employees thanks to this debt being paid off. The collective impact of those savings will be used to further invest in our region and will be felt profoundly within our community.

It is also important to thank and recognize that Rochester’s very own assemblymember Harry Bronson, who has been a tireless advocate of paying off the unemployment insurance debt alongside speaker Carl Heastie. In addition to being the dean of Rochester’s state delegation, assemblymember Bronson is also chair of the NYS Assembly Committee on Labor. Labor groups and business groups were aligned on this topic as unemployment insurance benefits could not be increased based on inflation until the entire debt was paid off. That means that anyone receiving unemployment insurance benefits, including over 17,600 individuals in Greater Rochester, would be making less than minimum wage when accounting for inflation. As a labor leader and a former business owner himself, Bronson understood the dual impact of this debt and was a true partner in this process. We thank him for supporting the Governor’s decision to push it over the finish line this year. We look forward to continued opportunities to align business and labor groups as a formidable team focused on job growth.

While Greater Rochester Chamber does not often stand up and take credit for what we do, I am proud of the work that our team has done surrounding this issue and our members are too. We have heard from dozens of businesses here in our own local community, sharing how this great outcome will benefit business. One member said they were “pleasantly surprised when I heard that this made it into the budget — thanks for your efforts to get businesses this victory.” Others have expressed feeling “relief for all of us” and “so very, very pleased” at this “excellent win for small businesses.” Our team has worked tirelessly on many fronts to keep this issue at the forefront throughout the last several budget processes, and specifically during this most recent one. I would love to hear even more stories like this and would encourage you to reach out and let me know how much your organization will save from this decision.

We are proud of Governor Hochul’s courage to stand up and use valuable reserve funds to pay off this debt in a time of great uncertainty. The governor was very thoughtful in trying to keep as much in the reserves as possible, but it is undeniable that this was the correct time to remove this burden for businesses. Between unemployment insurance tax rates slated to increase this summer if not paid off, prospective Federal budget cuts, tariffs and other potential increased costs our businesses, and economic uncertainty possibly leading to increased reliance on unemployment insurance, we needed to take care of our businesses and labor force now. The governor’s bold yet thoughtful leadership and leap of faith is something every business in New York State should be grateful for, and can serve as a lesson for business and community leaders in Greater Rochester on what strong leadership can deliver.

People are fast to criticize — the business community, the Governor, and our region — but tend to overlook the good things, the things that are making New York State better. This is a time to celebrate a great accomplishment for New York State’s businesses and employees alike, no matter what other opinions may be expressed. I am proud of this decision, and I speak for businesses across the Finger Lakes Region when I offer a collective thank you to Governor Hochul, Assemblymember Bronson, Speaker Heastie, and all who supported this great outcome for Greater Rochester and all of New York State.

Bob Duffy is president and CEO of Greater Rochester Chamber of Commerce. Contact him at [email protected].