Will benefits extensions be enough for unemployed jobseekers?
Hundreds of thousands of people around the country will be getting unemployment checks in their mailbox again.
After a long, strange trip through Congress, President Obama last week signed legislation that will pump $18 billion into unemployment payouts, putting checks back in the hands of jobless Americans who had exhausted their state benefits.
Under the new law, the long-term unemployed can receive benefits retroactively for the time they weren’t covered while the bill was hung up in Congress. Senate Republicans who had voted for the extension last month revolted this week, saying the legislation would add to the $12.8 trillion national debt. But Republican Senator George Voinovich gave Democrats the 60th vote they needed to push it through.
The legislation promises up to 99 weeks of unemployment checks for those whose 26 weeks of state benefits had run out. It’s a temporary measure that only runs through June 2—by which time Congress is expected to have hammered out another extension—and provides an average of $335 per week. When the federal funding for benefits expired last week, more than 200,000 people stopped getting those checks.
With jobseekers finding, in many cases, the toughest market of their lives, and in some cases in the hunt for a year or more, one provision of the bill may prove to be especially important: it extends a subsidy on the cost of health insurance under COBRA, paying up to 65 percent. When the jobless package expired last week, newly laid off workers couldn’t file for the subsidy, but they will now be eligible again.
There’s been a lot of confusion about what the new legislation will and won’t do, creating a serious headache for already frustrated jobseekers. With more than six million Americans out of work for more than 27 weeks, many might have set unrealistic hopes for the new federal money. Over at the Washington Independent, Mike Lillis lays it out this way:
Many long-term unemployed folks are hoping that Congress will create additional tiers of benefits. Sorry in advance for being the bearer of bad news, but the proposals floating around Capitol Hill wouldn’t do it…The confusion stems largely from the bewildering framework of the UI system itself. Very generally, states offer 26 weeks of benefits to qualified unemployed workers before four tiers (maximum) of federal benefits — dubbed Emergency Unemployment Compensation (EUC) – kick in. Tier I (20 weeks) and Tier II (13 weeks) were created by last year’s $787 billion stimulus bill. And last fall, lawmakers stepped in again to (1) add an extra week to Tier 2, making it 14 weeks instead of 13 weeks, (2) create Tier III (13 weeks) for states with unemployment rates higher than 6 percent, and (3) create Tier IV (6 weeks) for states with unemployment rates topping 8.5 percent.
Perhaps that’s why we’re seeing more and more calls for real reform, not just extensions, in the jobless-benefits system. This month, Warren Yoder, executive director of the Public Policy Center of Mississippi, made an impassioned plea for reform in that state’s laws:
Just when we need it the most, thousands of Mississippi workers are being denied unemployment benefits because of a broken, outdated system. When the national unemployment system was created in 1935, the work force was made up predominately of full-time, male workers. Today, that work force includes more part-time and female workers. Although America’s economy has changed, our state unemployment insurance system has not. This spring, fewer than four of 10 Mississippi workers qualified for unemployment benefits.
Change has been slow, though, and varies from state to state. Earlier this year, an attempt to restructure the benefits agency in South Carolina, after it ran out of money and was forced to borrow $700 million from the federal government, was shot down.
Meanwhile, at a federal level, the battle over benefits is only getting more bitter. We’ll have to see if this kind of atmosphere can produce any real change for jobseekers, who are as anxious as ever about their futures.
