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Congress’ Unfinished Business: Extend Unemployment Benefits

Posted by Elyssa Koidin  

02:09 PM Dec 08, 2011

The Bureau of Labor Statistics released unemployment data last week for the month of November. They reported that last month, unemployment decreased to 8.6%. While this is the first time in three years that the unemployment rate has fallen below 9%, some economists are skeptical that this is in fact positive news. Further analysis of the report shows that a significant number of people have completely given up looking for work. According to the New York Times, “Part of the reason the jobless rate feels so low was that 315,000 unemployed workers simply stopped applying for jobs.”

There remain 13.3 million Americans who are still looking for work but continue to find themselves unemployed. For this group, federal unemployment benefits are a vital resource. Over the past few months, it has become abundantly clear that many families continue to suffer during this stagnant economy. While many would love to find steady work, there is only one open job for every 4.5 unemployed workers. Safety net programs like unemployment insurance are a lifeline for the families of millions of Americans struggling to find a job.

These benefits put money in the pockets of families and individuals who tend to spend many of these dollars in their local communities on housing, food, medicine, and other basics. Economists estimate that the economy grows by $1.61 for every dollar spent on unemployment benefits because most recipients spend all of their benefit payments quickly. The U.S. Census Bureau also reports that in 2010 alone, unemployment benefits kept 3.2 million Americans from falling into poverty.

Still, this vital benefit is at risk of disappearing for the millions of unemployed citizens that depend on it if Congress does not take action by the end of the year when federal unemployment benefits are due to expire. Without immediate Congressional action to extend these benefits through 2012 then, according to the National Employment Law Project (NELP), “nearly 650,000 workers in 33 states and the District of Columbia will face an immediate ‘hard’ cut-off of their benefits in January, after struggling to find work and pay their bills for over a year in most cases. There is no phase-out allowing these workers to collect the remainder of their final 13 to 20 weeks in benefits.” Not only will the personal toll on families be catastrophic, but according to the Department of Labor, a significant economic loss will be felt by not extending unemployment benefits. If the extension does not take place by the end of the year, nearly a million U.S. workers could lose their jobs and the economy could lose $70-80 billion in 2012.

Senator Jack Reed (RI-D) and Representatives Sander Levin (MI-D) and Lloyd Doggett (TX-D) have introduced The Emergency Unemployment Compensation Extension Act of 2011 (H.R. 3346/S, 1804), which will extend the federal unemployment insurance program through 2012. We are urging local communities to reach out to their Members of Congress and ask them to support this legislation.

Congress has never cut back on federally-funded unemployment insurance with the jobless rate as high as it is now, and lasting for such a long period of time. According to NELP, “the highest unemployment rate when federal benefits were cut by Congress was 1985, at 7.2%.” Today the unemployment rate is 8.6%. These unemployed workers have earned their benefits by paying taxes into the system for years. Congress would be denying them help when it is needed most by allowing the program to lapse.

Leadership has expressed wishes to adjourn by December 16th (there is some doubt whether this date will hold). There is also the possibility that the unemployment insurance extension will be combined with other “must pass” pieces of legislation. Still there has been a lot of attention paid to the payroll tax cut extension and less discussion on Capitol Hill about the unemployment insurance extension, which is why it is critical that you reach out to your Members of Congress as soon as possible.

The Jewish Council for Public Affairs will be following this issue in the coming weeks. If you have any questions please contact Elyssa Koidin.

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