Sunday, February 14, 2010

Five Million Workers to Exhaust Unemployment Benefits by June

by Bill McBride on 2/14/2010 08:48:00 PM

Note: Scroll down or click here for a look ahead and weekly summary.

Back in December, the qualification dates for existing tiers of unemployment benefits were extended for an additional two months. Time is up at the end of February.

Now another extension is needed or millions of workers will lose benefits over the next few months.

The National Employment Law Project (NELP) released a new report last week showing that ...

1.2 million jobless workers will become ineligible for federal unemployment benefits in March unless Congress extends the unemployment safety net programs from the American Recovery and Reinvestment Act (ARRA). By June, this number will swell to nearly 5 million unemployed workers nationally who will be left without any jobless benefits.
...
Currently, 5.6 million people are accessing one of the federal extensions (34-53 weeks of Emergency Unemployment Compensation; 13-20 weeks of Extended Benefits, a program normally funded 50 percent by the states).
Exhaust Unemployment Benefits This table shows the NELP's projections:
Of the almost 1.2 million workers facing a cut off of benefits in March alone:

  • 380,000 workers will exhaust their 26 weeks of state benefits without accessing the temporary EUC extension program or the permanent federal program of Extended Benefits.

  • Another 814,000 workers will not be eligible to continue receiving EUC past their current tier of benefits.
  • The following graph is based on the January employment report and shows the number of workers unemployed for 27 weeks or more ...

    Unemployed Over 26 Weeks Click on graph for larger image in new window.

    The blue line is the number of workers unemployed for 27 weeks or more. The red line is the same data as a percent of the civilian workforce.

    According to the BLS, there are a record 6.31 million workers who have been unemployed for more than 26 weeks (and still want a job). This is a record 4.1% of the civilian workforce. (note: records started in 1948).

    The current qualification dates extension being considered is for another three months. Cynics might argue that some Senators want to limit the extension to an additional three months, so they can use the popular benefit extension in May to once again extend the homebuyer tax credit - hopefully the cynics are wrong!

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