While the jobs recovery is clearly underway, some states have been quietly taking steps to reduce the benefits they offer to newly unemployed workers, as reported by AARP on March 22. Despite 236,000 jobs generated in February, which brought the national unemployment rate from 7.9 percent to 7.7 percent, the United States is still running 3 million jobs short of the 2008 peak.
According to a report issued by the National Employment Law Project, a non-partisan, not-for-profit organization that conducts research and advocates on issues affecting low-wage and unemployed workers, at the beginning of the Great Recession, all 50 states offered 26 weeks of state benefits, a standard that dates back to the 1950s. Since the recession began, the federal government added several tiers of federally-funded extensions once state benefits were exhausted, which were based on a state’s unemployment rate.
Seven states have now cut the number of weeks that an unemployed person is eligible to receive benefits.
Starting July 1, North Carolina is reducing the number of weeks you can claim unemployment benefits from 26 to 20, and is reducing the maximum weekly benefit from $535 to $350.
In Michigan, unemployment is still running near 9 percent. Michigan cut its state-funded benefits from 26 to 20 weeks. Michiganders had been entitled to up to 63 weeks of benefits, including both the state-funded and federally-funded extensions. The maximum is now 49 weeks. And Michigan has cut the amount of benefits as well, as the result of the federal sequestration; beginning April 1, there will be a 10.7 percent reduction of all weekly benefits.
Georgia cut its state-funded weeks from 18 to 8, and the federal extensions have been reduced from 26 weeks to 11. This results in a total loss of 19 weeks of benefits for Georgia workers.
People unemployed in Florida have lost 17 weeks; in South Carolina, they have lost 14 weeks; in Missouri they have lost 12. Unemployed workers in Illinois will lose only 2 weeks of benefits.
It is true that the economy is growing, albeit slowly. And jobs are being created; again, slowly, and on top of that, many of the new jobs are in low-paying industries. Many workers are forced to accept temporary or part-time work.
The average unemployed worker at this point has been out of work for 35 weeks. People who have been out of work for over 6 months have a less than 15% chance of finding work in the upcoming month.
Unemployment insurance benefits are not the solution to our economic woes, but they do buy time for someone to find work in the current difficult job market. Cutting unemployment benefits is not a good solution to state budget woes. This only exacerbates the situation by driving more people to seek other state benefits once their unemployment expires.