Long-Term Unemployment Benefits Need More Than Extension

Huffington Post blogger Arthur Delaney has been hammering on an important fact about the just-passed temporary extension of long-term unemployment insurance benefits. It won’t fully extend benefits for everyone who’s getting them now.

By the time the temporary extension expires, workers in 11 states will have lost their benefits, he writes, even though they won’t have reached the maximum they’d have been entitled to in early December.

This isn’t because the Senate leaders who negotiated the bill changed the law. It’s because they didn’t.

Here’s the situation, as best I can summarize it, with help from a somewhat outdated, but still useful brief by the National Employment Law Project.

Under federal law, states can establish an Extended Benefits program to provide jobless workers with extra weeks of benefits during times of unusually high unemployment.

What’s unusually high can be measured in one of two ways. Most states and the District of Columbia have chosen what’s called the total unemployment rate.

The TUR is the most recent three-month average of the state’s regular unemployment rates as compared to the average for the comparable period during a prior year.

For a state to “trigger on” to the EB program, the current three-month average must be at least 6.5% higher than during the base-year period. That provides 13 extra weeks of UI benefits. A 10% higher average provides 20 weeks.

By the same token, a state “triggers off” the program when its three-month average isn’t sufficiently higher than during the comparable period. A state can thus “trigger off” when its unemployment rate is still very high.

Ordinarily, the federal government pays half the costs of extended benefits, and states pay the other half. The Recovery Act made the federal government temporarily responsible for the full costs.

When Congress extended the EB funding provision in 2010, it also gave states the option of changing the “look back,” i.e., the year their current unemployment rate would be compared to.

Instead of the usual one or two, they could have a three-year “look back.” This, of course, was in recognition of the long duration of high unemployment rates in a great many states.

Thirty-two states and the District of Columbia adopted the three-year “look back.” But now that’s not enough to keep states from triggering off, even though their unemployment rates are considerably higher than normal.

When that happens, workers who’ve been jobless long enough to get to the EB stage will get no more benefits. Other workers who reach that stage will also be in the same straits as the so-called 99ers are now.

So the EB provision needs another fix like the one Congress made last time. And the temporary extension law doesn’t have it.

Delaney reports that some House Democrats wanted it, but felt they had to give way to get any extension passed. “That’s the process,” said Congressman Steny Hoyer, the second highest-ranking member of their leadership team.

However, it’s also true that the President’s jobs bill didn’t change the “look back” either. So in this respect, Republicans are right when they say their plan resembles parts of his.

The Democrats could still insist on a straightforward four-year look back as part of the year-long extension package. But it’s doubtful they will.

Too many other issues — including the highly-controversial pay-for, i.e., how to extend all the measures in the package without increasing the near-term deficit.

Advocates reportedly hope for some split-the-difference compromise. Perhaps a waiver from the standard TUR trigger-off for states with double digit unemployment rates.

There aren’t all that many of them, however. Could be fewer as the months roll on.

So it looks as if many long-term jobless workers will be out of luck, even if the EB trigger language gets a partial fix.

But I hope I’m wrong.

We’ve got more than enough people falling into poverty without a pennywise-pound foolish decision to cut off a relatively small cash flow to workers who are still trying to beat the worse than 4-1 odds of finding another job.

4 Responses to Long-Term Unemployment Benefits Need More Than Extension

  1. […] I wrote awhile ago, the Extended Benefits program kicks in only when states’ unemployment rates are […]

  2. […] I wrote awhile ago, states “trigger off” EB when their average unemployment rate for the […]

  3. […] I wrote awhile ago, the Extended Benefits program kicks in only when states’ unemployment rates are […]

  4. […] I wrote awhile ago, states “trigger off” EB when their average unemployment rate for the current […]

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