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Bush to proposed grants to unemployed

WASHINGTON, Jan. 6 (UPI) -- President Bush will propose grants of as much as $3,000 to the unemployed as part of a new program to encourage people to find new jobs quickly, a senior administration official said Monday.

In a background briefing in advance of Bush's scheduled speech Tuesday before the Economic Club of Chicago, the official said the personal employment accounts will be aimed at those most likely to exhaust their unemployment benefits as well as those who may already have done so.

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The $3.6 billion, two-year program is designed to cover 1.2 million Americans.

"The way the re-employment bonus works, if you become re-employed within 13 weeks, you can keep the remaining balance," he said. "It may be the full $3,000 ... or it may be some portion of the $3,000."

Recipients will get 60 percent of the remainder at employment and the rest after they've been on the job for six months.

The official said the Labor Department studied programs in various states and found that even relatively small bonuses of just a few hundred dollars encouraged people to get back to work earlier, an average of one week, than those who did not have access to the bonuses.

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"The statistics of the unemployment insurance program nationally show a very small percentage .... somewhere between 2 and 5 percent of people who are on unemployment insurance right now are getting any type of services, job training services," the official said. "This will give people more flexibility and encouragement to get training. We think this is a new way of looking at helping dislocated workers get help in the marketplace and become fully employed."

The money also can be used for such things as child care and relocation costs as well as training.

The official said this program would be in addition to any extension of unemployment benefits passed by Congress.

Each state will get a share of the $3.6 billion based on unemployment rates. It will be up to the states to determine the actual size of the grants.

"This is being set up as a re-employment account to help dislocated workers," the official said. "This will help people make a quick return to work and give them incentives to do so."

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