Amazon, Google help states as coronavirus boosts unemployment claims

More than 30M have filed for unemployment benefits since efforts to contain the virus led to widespread business shutdowns in mid-March

WASHINGTON -- States including Rhode Island, Kansas and New York are turning to tech companies including Amazon Web Services and Google to handle an unprecedented rise in unemployment claims triggered by the coronavirus pandemic.

Continue Reading Below

TickerSecurityLastChangeChange %
AMZNAMAZON.COM INC.2,401.10-9.29-0.39%
GOOGLALPHABET INC.1,418.24-2.04-0.14%

More than 30 million Americans have filed for unemployment benefits since efforts to contain the virus led to widespread business shutdowns in mid-March. State labor departments across the nation have struggled with busy phone lines, website crashes and delays in unemployment payments, with some operating on decades-old technology.

Amazon.com Inc.'s technology is helping some states address these challenges. Rhode Island, formerly dependent on old computer systems and outdated call-center technology, rolled out federal programs on a quicker timeline than most other states, according to federal and state officials. Massachusetts's online system has been running without outages throughout the coronavirus pandemic. Kansas's call center is able to field more calls compared with earlier in the crisis, thanks to systems recently put in place, according to state officials.

Two people wearing masks walk near an Amazon Go store, Thursday, April 30, 2020, in downtown Seattle. (AP Photo/Ted S. Warren)

Google is working with New York and Illinois, among others, to upgrade their labor departments' decades-old computer systems, said Todd Schroeder, the director of public-sector digital strategy for Google Cloud.

Google, a unit of Alphabet Inc., is using cloud technology and artificial intelligence to upgrade the state agencies' website capacities and automate as much of the claim-filing process as possible, Mr. Schroeder said. Chatbots, for example, have been built to answer routine questions and relieve the pressure on human claims specialists.

GOOGLE ADDS COMPANY HOLIDAY FOR CORONAVIRUS WORK-FROM-HOME BURNOUT

The Texas Workforce Commission, which oversees unemployment benefits and other services for the nation's second-most populous state, worked with Accenture PLC to develop an artificial-intelligence system for steering inquiries using chatbots.

For Amazon, the new business from overburdened states is a bright spot in the company's bid to work with governments. Amazon is fighting the award of a more than $10 billion cloud-computing contract from the Defense Department to Microsoft Corp., arguing that criticism by President Trump of the contract process and of Amazon itself played an unfair role in the Pentagon's decision.

Aurora Ortega picks up an unemployment form at a Miami-Dade County library during the new coronavirus pandemic in Miami. Pressure has mounted on Florida Gov. (AP Photo/Lynne Sladky)

Members of the House Judiciary Committee recently called on Amazon Chairman and CEO Jeff Bezos to testify on its private-label practices after a Wall Street Journal article detailed the company's use of third-party-seller data to develop its own products.

Rhode Island turned to Amazon Web Services for help in April when its old computer systems and outdated call center became overwhelmed by the number of individuals seeking unemployment assistance during the coronavirus pandemic. The state's labor department drew on some of the federal dollars awarded in a stimulus package. As of the end of April, Rhode Island had paid about $300,000 for the new Amazon technology.

AMAZON, MEDICAL SUPPLY FIRM TEA MUP TO SELL CORONAVIUR SPPE TO HEALTH CARE WORKERS

Amazon and a Providence, R.I.-based nonprofit called Research Improving People's Lives developed an online application that accepts benefits applications from independent contractors and other employees made newly eligible by the federal stimulus bill. The changes allowed Rhode Island's labor department to be among the first states to begin rolling out the federal program.

Rhode Island also replaced call-center technology with the same system Amazon uses to handle call and internet volume during Black Friday sales events before Christmas. The cloud-based technology allowed the Rhode Island labor department to change from using 74 phone lines that left callers waiting for minutes to a system that can take 1,000 calls a second.

Hew Kowalewski, a furloughed employee of Disney World stands next to window of his home Monday, April 13, 2020, in Kissimmee, Fla. Many of Florida's jobless have reported problems filing applications for unemployment benefits. (AP Photo/John Raoux)

"Nobody who tried to certify in Rhode Island yesterday got a busy signal, " said Scott Jensen, director of the Rhode Island labor department, after the new call system was launched in April. About 75,000 Rhode Islanders were able to file claims on the phone the first day the system was implemented, an Amazon spokeswoman said.

AMAZON VP RESIGNS AFTER ACCUSING COMPANY OF 'FIRING WHISTLEBLOWERS'

In the early stages, Amazon is handling the bulk of the technical work to revamp the Rhode Island labor department's system. Amazon developers will stay on for the next year and help train state government staff to maintain the system after Amazon staff leave, a Rhode Island labor department spokeswoman said.

Kansas is still grappling with legacy technologies, said Delia Garcia, the state's secretary of labor. Individuals are accustomed to the quick satisfaction and ease that comes with shopping on sites such as Amazon, she said.

GOOGLE EMPLOYEES WORKING FROM HOME NOT ALLOWED TO EXPENSE FOOD, OTHER WORK PERKS

"People are used to that, and then they have to go and file their unemployment claims on an antiquated system," Ms. Garcia said. "The public is floored, and as they should be."

FILE - In this March 17, 2020 file photo, people wait in line for help with unemployment benefits at the One-Stop Career Center in Las Vegas. (AP Photo/John Locher, File)

The Kansas Department of Labor has spent about $75,000 through early May bringing on Amazon Web Services to help expand its unemployment call center. Ms. Garcia said because of the new technology, the department has quadrupled the number of calls it can handle compared with at the beginning of the pandemic.

Massachusetts was processing unemployment claims using Amazon's cloud technology before the coronavirus pandemic. In 2017, the state migrated its system to the cloud, said Charles Pearce, a Massachusetts labor department spokesman.

GET FOX BUSINESS ON THE GO BY CLICKING HERE

The state's online system has been able to handle the sharp rise in claims volume that caused many state websites to freeze. Massachusetts processed more than 400,000 continuing claims on Sunday, April 26. On average, it processes 20,000 claims on a typical Sunday, Mr. Pearce said.

Amazon is also helping Kentucky and West Virginia set up remote call centers to field unemployment inquiries, according to one of the company's filings with the Securities and Exchange Commission.

CLICK HERE TO READ MORE ON FOX BUSINESS