Monday, August 2, 2010

Obama Signed Additional Unemployment Insurance Payments

On July 22nd afternoon, President Obama signed into law a bill granting workers out of a job for more than 26 weeks additional unemployment insurance payments, paid for by the federal government. The benefits had been in place since November 2009, but had lapsed for seven weeks an unprecedented hiatus, given the 9.5 percent unemployment rate. The bill, held up in the Senate for more than two months by Republicans concerned about the deficit, makes benefits retroactive to June 2 and forward to Nov. 30. In states with higher than 8 percent unemployment, workers will continue to receive up to 99 weeks of benefits.

Around the country, the 99ers those who have exhausted the maximum number of weeks of federal and state unemployment benefits rejoiced. Now, advocates for 99ers, pressing members of Congress to extend benefits beyond 99 weeks and to create additional job-training and public works programs to get them back to work.

But even the most active members of Congress on the unemployment issue say there will be no bill to help 99ers by adding a fifth tier of benefits the most direct way to keep families and individuals out of poverty. The Ways and Means Committee originates most bills concerning unemployment, Social Security, Medicare and Temporary Assistance for Needy Families, or welfare benefits. Thus far, McDermott is the only member of Congress to have held hearings addressing the plight of the 99ers specifically.

The Senate inaction comes as the government reassesses the severity of the long-term unemployment crisis. Previously, the economists estimated the number of 99ers to be around 1 million. In June, the Labor Department said that 4.3 million Americans have been unemployed for more than one year. But the number is hard to tally. There is no way to track exactly what happens to individuals when they stop collecting benefits whether they make it back to work, or stop looking for a job, or continue the job search. And with the recession lagging on, some Labor Department economists believe the number might be as high as two or three million a population the size of Dallas, and bigger than the U.S. military.

And no matter how big that population is now, economist’s fear it is set to grow. Ninety-nine weeks ago, the recession had been ongoing for about eight months. But employment is a lagging indicator. It takes some time for businesses to notice the downturn in sales, and to make the choice to start reducing their workforces. That started happening in 2008 when the pace of layoffs climbed precipitously. In the first eight months of 2008, employers laid off 1.2 million workers. In the final four months, they laid off 2.4 million.

More layoffs two years ago translate into more 99ers now. And with job growth lagging far below levels needed to reduce the unemployment rate, the jobs situation continues to look parlous.