WORKERS COMP INCREASES WILL HURT - Timber Industry Could Be Hard Hit

(04/29/2003)
By Bob Weaver

New increases in Worker's Comp rates to save the agencies multi-billion dollar debt may plunge what is left of West Virginia industry into the abyss.

The Worker's Comp fund has been accumulating debt for several years, some say because the legislature has ignored mismanagement.

The proposed increases in workers comp premiums are capped at 15 percent on a base rate. Some may have even higher increases. The average state employer will see an increase of $2 for every $100 of payroll.

High-risk industries like timber, will see far higher increases. The timber industry will endure increases of $52 on every $100 of payroll.

These increases are temporary fixes.

The outlook is bleak as a select committee is trying to write a bill aimed at shoring up the state's workers compensation system.

Manufacturing jobs in West Virginia are already in a steep decline. The West Virginia Chamber of Commerce said about 35,000 jobs left the state last year, but unemployment statistics do not reflect the loss. The state had among the highest number of small business closures last years.

Karen Price of the West Virginia Manufacturers Association admits it's a difficult time, but stops short of calling the situation hopeless. She says the working group is taking the proper approach by trying to attack the problem.

Gov. Wise says many states have had similar losses, including states that are traditionally considered prime locations for manufacturing industries like North and South Carolina.

Rarely is the decline of manufacturing jobs blamed on NAFTA, GATT and the "free trade" movement, but many West Virginia jobs have gone abroad, while others have failed because of foreign competition.

The recession has caused most state governments in America to go to crisis management because taxable income is down. Many manufacturing and service jobs have been reduced to minimum wage, or an average of less than $7 an hour.