With no end in sight to America’s job market woes, the House of Representatives has agreed to give the jobless in a majority of states another 13 weeks of unemployment insurance benefits.The bill, which passed the House 331-83, approves the extra three months of benefits for those jobless living in 27 states, plus Washington and Puerto Rico, with unemployment rates topping 8.5 percent. Similar legislation is pending in the Senate. The longtime unemployed in states with lower levels of joblessness would not get the extension.
The job market appears to be the last to recover from a recession that officially began in December 2007. Jobless benefits have already been extended to record lengths because of federal intervention.
States offer 26 weeks of benefits, with the average payment about $300 a week. But with federal help, including provisions from the economic stimulus bill, the unemployed in states hardest hit by the recession can receive up to 79 weeks of assistance.
About 5 million of those unemployed, about one-third of the total, have been out of work for six months, another figure that far outpaces recent recessions. There are some six people looking for every job available.
“Providing these Americans with a modest economic lifeline is not only the humane thing to do but it’s in the economic interest of the country,” said the bill’s sponsor, Democratic Rep. Jim McDermott, noting that every unemployment insurance dollar has $1.64 in positive economic impact by supporting existing jobs and the housing market.
He said the immediate effect of the bill would to keep assistance flowing to about 300,000 people, three-fourths of those expected to exhaust their benefits in September. Through the end of the year, it would protect more than 1 million from losing their benefits, he said.
One of the 17 Democrats to vote against the bill, Rep. Charlie Melancon, said he did so because the unemployed in his state, with its lower unemployment rate, did not qualify. The jobless in neighboring Mississippi are eligible.
Democrats stressed that their economic policies were pulling the nation out of a recession and the legislation was needed because of the lingering problems in the job market.
“The headlines may say that our recession is over, but for those who remain out of work, this is still a time of hardship and struggle,” said House Majority Leader Steny Hoyer.
Republican Rep. Geoff Davis of Kentucky, one of the 27 states qualifying for the additional benefits, saw it in a different light, saying the need for the legislation was “yet another sign of the failure of this administration’s stimulus plan to create jobs.”
The unemployment rate now is 9.7 percent and economists see it topping 10 percent in 2010.
McDermott said his bill would cost $1.4 billion but does not add to the deficit because it raises money from extension for a year of a federal unemployment tax, costing about $14 an employee per year. That tax, which brings in about $7.2 billion in a year, has been on the books for 30 years, with the money going into the federal unemployment insurance trust fund. The bill would also require better reporting on new employees to reduce unemployment insurance overpayments.
The stimulus act passed last February added $25 to people’s unemployment check. It also expanded several federal programs to help cash-strapped states, increasing the maximum level of benefits for the hardest-hit states to 79 weeks.
Because the recession officially began in December 2007, people getting the full 79 weeks could be running out of benefits and would be entitled to the 13-week extension.
The bill is H.R. 3548.
