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Long Term Unemployment Face Tough New Year

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It has not been a happy new year for the long term unemployed who been out of work for 26 weeks or longer. Lawmakers allowed the long term unemployment benefits to expire on December 28, 2013. When lawmakers returned to Washington there were high hopes that Republicans and Democrats could work a deal to extend long term unemployment benefits in 2014.

Today the deal fell apart as lawmakers left Washington for the weekend. Republicans are willing to extend long term unemployment benefits for three months as long as there are spending cuts. Democrats favor approving another year of benefits for the long term unemployed.

The Labor Department and the Council of Economic Advisers project that without long term unemployment benefits the economy could lose 240,000 jobs this year. While the number of long term unemployed has dropped since the Great Recession it is still at the highest level since World War II.

For many long term unemployed the benefits they had been receiving was keeping them just short of poverty. It is projected there are 1.3 million long term unemployed who were receiving benefits until the program expired. Conceptually unemployment benefits are intended to help support the economy as it recovers. The low unemployment benefit amounts means there is spending on essentials which in turn aids recovery at a slow pace.

There are nearly 10 million unemployed in the United States of that number it is expected 3 million in 2014 may not find a job in the first 26 weeks of unemployment and will experience long term unemployment. Unless Washington can come up with an extension for long term unemployed it is going to be a tough year.

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