Projected changes to California workers’ comp claims frequency and severity due to industry mix of employment are negligible through 2026, while employment in most industries fully recovered from the initial pandemic related changes by the end of 2022, a new report from the Workers’ Compensation Insurance Rating Bureau of California shows.

WCIRB this week released an update to the Impact of Economic Changes on California Workers’ Compensation report.

The report shows that while employment in hospitality fully recovered in 2023, retail employment is expected to remain below 2019 levels until 2026. The report forecasts construction employment to grow moderately in 2024 and 2025 and slowly in 2026, similar to the overall growth.

Healthcare employment fell slightly in 2020, then rebounded in 2021. It is projected to grow modestly through 2026, according to WCRIB.

“Unemployment is forecast to increase slightly in 2024 and then decrease slightly, remaining at historically low levels,” the report shows. “WCIRB research has found that increases in unemployment are correlated with decreases in indemnity claim frequency. Given the current forecast of changes in the unemployment rate is small, there would also be a small impact on changes in indemnity claim frequency.”

Claim frequency rose substantially in 2021 due to the mix of employment by industry, an increase largely driven by the return of hospitality employment, but modest industry mix impacts on claim frequency and severity are projected to continue and offset each other, yielding negligible pure premium impacts through 2026, according to WCIRB.

Wages overall are forecast to increase strongly in 2024, then return to a lower increase in 2025 and 2026.

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Workers’ Compensation

SACRAMENTO, Calif. (AP) — California plans to spend up to $12 million on reparations legislation under a budget signed by Democratic Gov. Gavin Newsom, marking a milestone in the state’s efforts to atone for a legacy of racism and discrimination against Black Californians.

The reparations funding in the $297.9 billion budget Newsom signed over the weekend does not specify what programs the money would go toward. Lawmakers are not considering widespread direct payments to Black Californians this year.

The state Legislature is weighing proposals to issue a formal apology for California’s role in perpetuating discrimination against Black residents, to create an agency to administer reparations programs, and to identify families whose property was unjustly seized through eminent domain.

The funding comes after federal reparations efforts have stalled for decades.

“We often say the budget is a reflection of our values and our priorities, so the fact that there’s any money for reparations should be a reason for celebrating,” said state Sen. Steven Bradford, a Los Angeles-area Democrat, noting he hoped the allocation would have been larger.

No state has gotten further along in its consideration of reparations proposals for Black residents than California, but some have made significant strides. Illinois and New York passed laws in recent years to study reparations proposals for African Americans. Florida passed a law in the 1990s creating a college scholarship fund for descendants of Black residents who were killed in a 1923 massacre initiated by a white mob.

But some opponents of reparations proposals being considered by lawmakers in California say taxpayers should not have to have to pay to address policies and practices from a long time ago.

“Slavery was a stain on our nation’s history, but I don’t believe it’s fair to try to right the wrongs on the past at the expense of the people today who did nothing wrong,” Assembly Republican Leader James Gallagher said in a statement. “More than a quarter of Californians are immigrants — how can we look at those people, who are struggling as it is, and say it’s on them to make up for something that happened more than 150 years ago?”

Senate President Pro Tempore Mike McGuire, a Democrat, said at an event Monday that “the $12 billion is not nearly enough” but that lawmakers worked closely to secure the money during a tough budget year.

Bradford introduced proposals to give property tax and housing assistance to descendants of enslaved Black people, but those were blocked in May by a key committee.

Kamilah Moore, who chaired the state reparations task force, was disappointed that lawmakers also did not introduce legislation this year to provide free tuition at public colleges for descendants of enslaved Black people, which the group recommended in its final report.

But Moore said it was still “good news” to see $12 million for reparations included in the budget as a starting point.

“It means that they’re taking accountability and responsibility, and they’re acknowledging the harms and the atrocities to this particular population,” she said. “That’s a huge step that should not be overlooked.”

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Associated Press writer Trân Nguyễn contributed to this report.

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Austin is a corps member for The Associated Press/Report for America Statehouse News Initiative. Report for America is a nonprofit national service program that places journalists in local newsrooms to report on undercovered issues. Follow Austin on X: @sophieadanna