Behind the Jobless Benefits Debate #1: What’s the Issue Before Congress?

November 8, 2010 at 4:50 pm

As I mentioned recently, over the next few weeks we will issue a series of posts that look behind the debate over continuing a federal program that provides emergency unemployment benefits and explain what’s at stake for jobless workers and the economy.  Here’s the first in the series:

On November 30, the federally funded program that provides emergency unemployment insurance benefits is scheduled to expire.  The program gives additional weeks of benefits to workers whose 26 weeks of regular, state-funded unemployment benefits run out before they can find a job.  With the unemployment rate expected to remain above 9 percent through next year, the fundamental question that Congress will debate in the coming weeks is whether to continue an emergency federal program.

Congress has created a temporary program like this in every major recession since the 1950s to address the fact that job opportunities become scarce in a downturn and it can take longer than 26 weeks to find a job, no matter how hard workers are looking.

Congress created the current program, Emergency Unemployment Compensation (EUC), in June 2008.  And in the 2009 Recovery Act, Congress also provided full federal funding for the permanent Extended Benefits (EB) program, whose cost is typically shared between the states and the federal government.  The full federal funding for EB allowed many states to temporarily expand their programs.  But that full federal funding will expire along with the EUC program on November 30 — even though over two-fifths of the unemployed have been looking for a job for more than 26 weeks.

If that happens, all federal unemployment insurance benefits will end in 40 states, and the number of weeks available in the rest of the states will shrink significantly, as the map below shows.  Most of the several hundred thousand workers who exhaust their regular state benefits each month would receive no further help, and many of the 5 million workers now receiving federal emergency benefits would lose their remaining weeks.

Other posts in the series:

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More About Chad Stone

Chad Stone

Chad Stone is Chief Economist at the Center on Budget and Policy Priorities, where he specializes in the economic analysis of budget and policy issues. You can follow him on Twitter @ChadCBPP.

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6 Comments Add Yours ↓

Comments are listed in reverse chronological order.

  1. Theresa Anderson #

    I presume your map only indicates the length of regular UI benefits and excludes extended benefits (EB). Many states still qualify for EB and will continue to do so until unemployment rates decrease; the only thing that will change after this month will be that the federal government will not fully finance EB. A list of states that qualify for EB can be found here:

    Some states changed their laws to trigger EB when the federal government agreed to fully subsidize the program by instating the 6.5% Total Unemployment Rate (TUR) option (e.g. CA, FL, GA, IL, MI, and TX). Undoubtedly, several states will change those laws back once federal support decreases. However, under current law, many states colored dark blue your map will still offer more than 26 weeks of UI after the end of this month.

    • 2

      Our map includes EB in those states that would continue to provide it. As you observe, several states changed their state laws to use the optional total unemployment rate (TUR) trigger as long as the federal government was funding the entire cost. However, those states wrote their laws to revert to the standard trigger when full federal funding is not available, as it will not be after November 30 if the federal emergency benefits program is not renewed. Our map reflects the fact that EB would not be triggered on in most states under the standard trigger. Many of these states have already triggered off EB and will not be providing it in December because of the scheduled expiration of the federal benefits, as shown here:

  2. david a lawrence #

    To whom it my concern : A compromise, please extend the current tax rates for five years for all. In five years the (rates) may change for a gross income per. year of $1,000,000 or more. Although very five years after that these rates could change,giving individuals and business a look forward to any new expenses incurred. Thank you for your time,David A.Lawrence

  3. Ana #

    Griff, I totally agree with you. I’m one of those unfortunate older workers, 55, who was laid off, it seems like eons, 18 months ago. I’m dumbfounded by the lack of interest I’ve received from employers. I’m a college grad, albeit liberal arts as a major might not be an attention grabber, & I’ve worked pretty steadily for over 30 years. The U.S. government can squander billions on wars, careless financiers and just out and out waste, but we, the unemployed workers are made to feel like unmotivated deadbeats who need to just pull ourselves up by out bootstraps and get on with it. No consideration for the recession, employers who are hoarding resources and overloading present staff as opposed to hiring & hiring agents who are blatantly stating the unemployed need not apply. I hope that this lame duck session proves not to be so lame and extends EB benefits. But, I don’t believe that will occur.

    • griff #

      good luck ana – and everybody else

  4. griff #

    if we add up all the gov waste,fraud and abuse plus the fact we give out hundreds of billions ( think the marshall program for one ) why shouldnt we take care of our own. its like pulling teeth getting congress to get a extension. these people lost their jobs through no fault of their own. the government has no problem with paying $500,000,000 a day ( thats right – a day )to service our national debt plus 90,000,000,000 ( 90 bilion ) a year in medicaid fraud the government admits to.

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