The Issue: U.S. long-term unemployed about to lose extended benefits

By MARCELLA S. KREITER, United Press International  |  Dec. 8, 2013 at 4:30 AM
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Vera Volk of Lynn, Mass., is scared. With her state unemployment benefits about to run out, the federal extended benefits about to expire and her husband's information technology consulting business in the tank, she doesn't know how her family will survive.

Volk was among the witnesses who appeared before a Democratic Steering and Policy Committee hearing on expiring unemployment insurance benefits last week, begging Congress to extend the program that began in 2008 at the start of the Great Recession.

More than a quarter of 4.1 million long-term unemployed people -- 718,000 fewer than in November 2012 -- will lose their extended unemployment benefits Dec. 28 with 3.6 million more set to see their benefits end at the close of 2014 unless Congress acts -- an unlikely prospect given the mood among House Republicans.

Extended benefits were available for an average 53 weeks in 2010 and now are available for 28 weeks. A proposed extension would cut that to 14 weeks.

"We have very little appreciable income coming in. In fact, it's just my state unemployment," said Volk, who said she spends 8 hours a day searching for work. She said she has a bachelor's degree in microbiology and a master's in immunology -- and lost her job in May as a result of the sequester.

Her state benefits run out this week.

"So I am going to be one of those ... Americans on [extended benefits] in 2013. And to face the fact that those benefits end at the end of this year is truly creating distress within me."

"I hate being unemployed. It's a waste of my time, my abilities," said Stan Osnowitz, 67, a Baltimore electrician.

"Construction work is a hard find in the winter and outside -- and outside of my industry, from what I've seen, potential employers see my age and look right past me.

"I still get up at 4, 4:30 every morning -- that's Saturdays and Sundays [too]. I'm actively pursuing work in my union and elsewhere."

Osnowitz said being unemployed is very difficult.

"As you sit out of work, you start questioning your ability to do a job. Your worth drops. Your self-confidence drops. And it takes quite a bit to build that back up," he said.

"It's hard to be unemployed. You're -- I feel myself ... a craftsman. I build. I enjoy building. I like to look back on what I built and say, I did that. That's my pride.

"When you don't have a job, you feel worthless."

Last week's hearing was designed to influence public opinion, putting faces of people -- mostly professionals in their 50s who face a tight job market as well as age discrimination -- to the numbers. The hearing, however, was conducted by Democrats with no GOP participation.

"I just wish my colleagues on the other side [Republicans] were sitting here listening to you. They're not," Rep. Grace Napolitano of California observed.

"If Congress fails to renew the Emergency Unemployment Compensation program, federal jobless benefits for 1.3 million long-term unemployed job-seekers will abruptly end three days after Christmas, said Christine Owens, executive director of the National Employment Law Project.

"By July 1 of next year, 2 million more will have no federal aid when their regular state benefits end," she said.

"Millions of jobless workers are facing severe hardship, even homelessness in many cases, if Congress allows the EUC program to expire. The value of the emergency benefits program, and the urgent need to maintain it in 2014 -- for workers, their families and the economy -- was evident in the testimony of ... worker witnesses, whose stories clearly struck the hearts and consciences of the House members who were present.

"It's hard to imagine that anyone hearing today's witnesses would doubt the sincere desire of the long-term unemployed to get back to work ... the crucial importance EUC benefits play in making it possible for them to get by while looking for work, and the urgent need for Congress to act -- before the [holiday] recess -- to renew this vital program."

Long-term benefits average $1,166 a month -- about 83 percent of what an average family spends on housing alone, NELP said.

House Speaker John Boehner, R-Ohio, blamed the administration for continued high unemployment.

"We're not creating enough jobs. We're not creating higher wages. I would argue that the president's policies are getting in the way of our economy growing," Boehner told a news conference.

"If the president has a plan for extending unemployment benefits, I'd surely entertain taking a look at it. But I would argue the president's real focus ought to be creating a better environment for our economy and creating more jobs for the American people. That's where the focus is, not more government programs."

Nearly 24 million U.S. workers have received extended benefits since 2008, 4.8 million of whom had at least a bachelor's degree, with families that included 17 million children, the President's Council of Economic Advisers reported

"Allowing [extended unemployment benefits] to expire would be damaging to the macro-economy and the labor force," the report said, predicting the cut in job-seekers' incomes will lead to reduced demand and cost the economy 240,000 jobs in 2014.

"Economists have found that any disincentive to find new work that could result from extended UI benefits is, at most, small.

"Expiration of extended ... benefits may also lead some long-term unemployed to stop looking for work and leave the labor force, reducing the number who could eventually find jobs as the economy heals."

The report also noted former President George W. Bush signed the extended benefits law when the unemployment rate was 5.6 percent and the average job hunt took 17.1 weeks. Unemployment now stands at 7 percent and the average job-hunt takes of 37.3 weeks, the Bureau of Labor Statistics reported.

"The progress made since the depths of the recession in 2010 is a testament to the resilience of the American economy and the American people. Yet more must be done: There remain [10.9] million Americans unemployed, over 4 million of whom have been unemployed for more than 26 weeks," the report said, adding the pain of the recession "has been mitigated by the unemployment compensation programs."

The report said the extended benefits have kept more than 69 million people from falling into poverty since 2008 and helped the economy climb out of the recession.

"If Congress fails to act, the current programs will expire in the last week of December 2013. More than 1.3 million long-term unemployed workers will lose their unemployment benefits at once at the end of December, and millions more will have no benefits after their initial 26 weeks of [unemployment] payments are exhausted during the course of 2014. Without an extension, 4.9 million workers will be affected by the end of 2014, and employment will be lower by 240,000 in 2014."

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