Emergency Unemployment Benefits To Run Out Dec. 28

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Emergency Unemployment Benefits To Run Out Dec. 28

Premiere Date: 
December 13, 2013

The budget agreement reached this week doesn't include an extension of the benefits.

 

Episode Transcript: 

Frederica Freyberg:

Wisconsin Congressman Paul Ryan describes a new federal budget deal as moving in the right direction. Ryan chairs the house budget committee and brokered a deal with Democrats that restores $63 billion in mandatory spending cuts. It avoids another government shutdown and eases automatic budget cuts. Mark Pocan of Madison is the only member of Wisconsin’s house delegation to vote against the budget deal. Part of why Congressman Pocan voted no on the budget plan was because it didn't extend federal unemployment benefits. Meanwhile, the number of people seeking US unemployment benefits last week surged to the largest increase in more than a year according to latest numbers. According to the US labor department, Wisconsin tops the nation with the largest increases in initial unemployment claims, at more than 4,400. And thousands more Wisconsin residents are set to lose federal emergency unemployment benefits. Right now, Wisconsin residents who lose their jobs are eligible for up to 26 weeks of state unemployment benefits. After that, emergency federal benefits kick in, for another 28 weeks. Those benefits, which began at the onset of the recession, are set to expire at the end of December if congress doesn't act. Joining us this week to look at the impact in Wisconsin is Tamarine Cornelius, a research analyst with Wisconsin Budget Project, which is an arm of the Wisconsin Council on Children and Families, and thanks very much for being here. Well, now, nearly 25,000 unemployed in Wisconsin will lose their extended federal benefits just after Christmas. What's your reaction to the budget deal in Washington not extending these benefits as part of that deal?

Tamarine Cornelius:

Well, it's disappointing that they couldn't see their way to including an extension of federal unemployment benefits as part of that deal. But it's not too late. They could still come to an agreement after the first part of the year and then could retroactively give people their benefits, which is what they've sometimes done in the past. So we're keeping our fingers crossed that a reauthorization will be attached to some piece of legislation. It has to pass. Perhaps it will be passed in the first part of the year.

Frederica Freyberg:

What's your reasonable expectation as to whether or not that might actually happen?

Tamarine Cornelius:

I think it's anybody's guess.

Frederica Freyberg:

Now, the rationale in some quarters as to why these benefits don't need to be extended is because the unemployment rate is coming down across the board, including here in Wisconsin. And yet how do you kind of reconcile the unemployment rate with these numbers out of the US Labor Department on first-time claims for unemployment compensation benefits?

Tamarine Cornelius:

Well, the numbers that show that Wisconsin is high in these claims, I wouldn't put too much weight on those, because those bounce around a little bit. But even though the unemployment rate is coming down, what's still alarmingly high is the long-term unemployment rate, so people who have been out of work for a long time. And right now more than a third of people who are out of work have been out of work for six months or more, and the average duration of unemployment is 36 weeks.

Frederica Freyberg:

And so that's exactly what these emergency federal unemployment benefits get at.

Tamarine Cornelius:

They help people who have been looking for a job for a long time.

Frederica Freyberg:

And where does Wisconsin stand in terms of its number of these long-term unemployed?

Tamarine Cornelius:

Well, about 24,000 people will be affected right at the end of the year when their federal unemployment benefits suddenly end. And then over the course of the next year, additional people who are currently receiving state-funded unemployment benefits will exhaust their benefits and then not be able to move to the federal ones if the program isn't reauthorized. So total about 99,000 people in Wisconsin will be affected over the next year.

Frederica Freyberg:

What do you make of the argument on the part of some lawmakers that these kinds of extended benefits just make people lazy to want to go out and find a job?

Tamarine Cornelius:

People who are receiving unemployment benefits want a job. They're looking for a job. Unfortunately, right now in this economy, there are more than three job searchers for every job opening. Eliminating this modest safety net doesn't make those jobs appear. If people want to reduce the number of people on unemployment benefits, then they should work towards helping the economy create secure, family-supporting jobs rather than eliminating the safety net for people who have lost jobs through no fault of their own.

Frederica Freyberg:

Which parts of Wisconsin will be most affected by these cuts of the emergency federal benefits and then going forward people who are long-term unemployed?

Tamarine Cornelius:

The hardest-hit areas will be areas with high unemployment and that, to large part, is northern, rural Wisconsin because there’s relatively high rates of joblessness up there. So the businesses up there are going to be feeling it, too, because people will have less money to spend at those businesses.

Frederica Freyberg:

I was going to ask, it's not just the families, the impact on the families who will be losing these benefits, but the surrounding communities and their economies as well.

Tamarine Cornelius:

Right. So unemployment benefits have two purposes. One is a lifeline to families who are out of work, but then they also create spending and create jobs, because people who receive unemployment benefits go out and spend that money right away on necessities. So those businesses won't have those customers. And in fact, if congress doesn't reauthorize the federal unemployment program, then that's going to cost the national economy about 300,000 jobs in the next year from that reduced spending.

Frederica Freyberg:

What is the average unemployment check?

Tamarine Cornelius:

It's about $270 per week.

Frederica Freyberg:

And how meaningful is that to the families?

Tamarine Cornelius:

It's a modest amount, but it's very meaningful, because many of these families have no other source of income.

Frederica Freyberg:

All right. And so you're awaiting-- obviously, it didn't happen now, but awaiting potentially after the 1st of the year when there could be some kind of legislation?

Tamarine Cornelius:

In the past what they've done is reauthorized and then continued to phase out, and that's what we're hoping congress will do again this year.

Frederica Freyberg:

All right. Tamarine Cornelius, thanks very much.

Tamarine Cornelius:

Sure thing.

Frederica Freyberg:

Without new action benefits for 1.3 million unemployed workers will expire on December 28. An additional 1.9 million people who are jobless are predicted to experience the same fate in the first half of 2014. 


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