Sequester Hits Long-Term Jobless Workers Hard

We may not yet have hard data for everyone affected by the across-the-board cuts to many non-defense programs — hence the overly-upbeat Washington Post article I recently took apart.

But we do now have a report on losses that long-term unemployed workers and their families are suffering.

It confirms — and then some — the Labor Department’s update for the Post, which said that unemployment insurance benefits cuts were, in some states, as high as 11%, rather than the 9.4% it predicted earlier.

The affected workers are those who’ve been unemployed longer than their regular state UI programs cover — generally 26 weeks.

Federally-funded Emergency Unemployment Compensation benefits have given them some ongoing cash income for awhile.

The sequester cut funding for the already-shrunken EUC program by a total of $2.4 billion. States and the District of Columbia were left to figure out how to deal with their share of the cut.

The National Employment Law Project’s tabular report tells us what each has done and the effect on EUC benefits, both average and maximum. Also the approximate number of jobless workers affected.

Thirteen states and the District acted swiftly. So the pain came sooner, but was less severe. Here in the District, for example, benefits were cut, as of the end of March, by 10.7%.

This has left somewhere around 8,600 workers with benefits averaging $1,024 a month — about $7,240 less than the federal poverty line for a family of three. (Shows that the benefits weren’t all that comfortable a hammock, even before the cuts, of course.)

Some states took the same across-the-board approach, but started their cuts later. The percent cuts thus had to be larger.

In Maryland, which began its cuts at the end of June, workers lost 22% — an average of $72 a week. Virginia workers lost 14.2% — an average of $40 a week — because the state began its cuts somewhat earlier.

Seven states realized all the required savings by limit the cuts to new EUC beneficiaries — or to them and those moving to the next tier, i.e., the additional weeks of benefits they could get because they were still unemployed.

A couple of states decided to pay no benefits for one week in each of three months. Two other states reduced the number of weeks benefits would be paid to workers who’d been unemployed the longest (and still eligible for EUC).

And North Carolina, which cut both the weeks and maximum benefits in its own UI program, effectively wiped out EUC benefits because the federal law denies funding to states that cut the benefits they themselves provide.

Rounding out the list are two states — Louisiana and Nevada — that still haven’t put their EUC savings plans in place. Their cuts will, of course, have to be enormous. And Louisiana will be starting from benefits averaging a mere $201 a week.

Echoing the Labor Department, NELP says that as many as 3.8 million workers and their families will be affected this year.

Those already in the EUC program were receiving, on average, $1,156 a month. They’ll be trying to somehow get along on $172 less. “That alone,” NELP notes, “can be the difference between making — or not making — a rent, car or mortgage payment.”

Meanwhile, the job market is still “in a slog,” as the Economic Policy Institute’s Heidi Shierholz reports. Another round of spending cuts will hardly improve it.

Yet we see no sense of urgency to do anything for the jobless workers whose UI benefits won’t keep them and their families afloat — or those who will come to the end of their last tier and have nothing at all.

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One Response to Sequester Hits Long-Term Jobless Workers Hard

  1. […] the EUC program in early 2012 are part of this story. I suppose more recent figures would show the impact of sequestration as […]

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