By CaraLynn Caulfield
Long Island business leaders are praising New York’s decision to pay off nearly $7 billion in federal Unemployment Insurance (UI) debt, calling it long-overdue relief that will lower costs for employers and strengthen the state’s economy.
Governor Kathy Hochul highlighted the repayment during an event in Syracuse this week, joined by state officials and business leaders. She said the move — finalized as part of the Fiscal Year 2026 state budget — not only brings the state’s UI Trust Fund back to solvency but also delivers direct benefits to both employers and workers.
“With the Unemployment Insurance Trust Fund loan paid off, businesses and workers across the state will feel and see the financial relief they deserve during a time when inflation is just so high,” Hochul said. “New York State continues to work to put money back into the pockets of New Yorkers, cut costs for our businesses and uplift the state’s economy.”
The repayment follows years of pandemic-driven borrowing. Before COVID-19, the UI Trust Fund held nearly $2.5 billion, but massive job losses forced the state to borrow billions from the federal government, freezing the maximum UI benefit at $504 per week.
Now, with the loan fully repaid, the maximum benefit will rise to $869 in October, according to state officials. The payoff is also projected to save employers an average of $100 per employee in 2026 and $250 per employee in 2027.
“The UI debt was one of the last lingering reminders of the economic toll of the Covid pandemic,” said Matt Cohen, president and CEO of the Long Island Association. “The LIA applauds Governor [Kathy] Hochul and the New York State Legislature for delivering this significant relief to our business community.”
Terri Alessi-Miceli, President and CEO of the Hauppauge Industrial Association of Long Island (HIA-LI), called the move “meaningful relief that lowers the cost of doing business and strengthens our economy.”
Labor Commissioner Roberta Reardon echoed that sentiment, saying, “This action will cut costs for our businesses and increase benefits for unemployed New Yorkers when they need it most. By stabilizing this critical safety net for our workforce, we’re ensuring New York State is more affordable for all.”
Empire State Development Board Chair Kevin Law said the move also positions New York for long-term growth. “By reducing costs and restoring stability to the fund, we’re creating the conditions for sustained growth, economic resilience, and job creation,” he said.
State officials added that rebuilding the UI Trust Fund will help prevent future spikes in employer costs, thanks to a scheduled increase in the taxable wage base that will stabilize the fund over time.
“This is a win for both businesses and workers,” said Hope Knight, president and CEO of Empire State Development. “Paying off this debt improves New York’s business climate and provides direct, tangible benefits to employers across the state.”