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Most of the Unemployed No Longer Receive Unemployment Benefits
WASHINGTON — The jobs crisis has left so many people out of work for so long that most of America's unemployed are no longer receiving unemployment benefits.
People stand in line to apply for jobs in Miami, Florida, in September 2011. The jobs crisis has left so many people out of work for so long that most of America's unemployed are no longer receiving unemployment benefits. (photo: AFP) Early last year, 75 percent were receiving checks. The figure is now 48 percent — a shift that points to a growing crisis of long-term unemployment. Nearly one-third of America's 14 million unemployed have had no job for a year or more.
Congress is expected to decide by year's end whether to continue providing emergency unemployment benefits for up to 99 weeks in the hardest-hit states. If the emergency benefits expire, the proportion of the unemployed receiving aid would fall further.
The ranks of the poor would also rise. The Census Bureau says unemployment benefits kept 3.2 million people from slipping into poverty last year. It defines poverty as annual income below $22,314 for a family of four.
Yet for a growing share of the unemployed, a vote in Congress to extend the benefits to 99 weeks is irrelevant. They've had no job for more than 99 weeks. They're no longer eligible for benefits.
Their options include food stamps or other social programs. Nearly 46 million people received food stamps in August, a record total. That figure could grow as more people lose unemployment benefits.
So could the government's disability rolls. Applications for the disability insurance program have jumped about 50 percent since 2007.
"There's going to be increased hardship," said Wayne Vroman, an economist at the Urban Institute.
The number of unemployed has been roughly stable this year. Yet the number receiving benefits has plunged 30 percent.
Government unemployment benefits weren't designed to sustain people for long stretches without work. They usually don't have to. In the recoveries from the previous three recessions, the longest average duration of unemployment was 21 weeks, in July 1983.
By contrast, in the wake of the Great Recession, the figure reached 41 weeks in September. That's the longest on records dating to 1948. The figure is now 39 weeks.
"It was a good safety net for a shorter recession," said Carl Van Horn, an economist at Rutgers University. It assumes "the economy will experience short interruptions and then go back to normal."
Weekly unemployment checks average about $300 nationwide. If the extended benefits aren't renewed, growth could slow by up to a half-percentage point next year, economists say.
The Congressional Budget Office has estimated that each $1 spent on unemployment benefits generates up to $1.90 in economic growth. The CBO has found that the program is the most effective government policy for increasing growth among 11 options it's analyzed.
Jon Polis lives in East Greenwich, R.I., one of the 20 states where 99 weeks of benefits are available. He used them all up after losing his job as a warehouse worker in 2008. His benefits paid for groceries, car maintenance and health insurance.
Now, Polis, 55, receives disability insurance payments, food stamps and lives in government-subsidized housing. He's been unable to find work because employers in his field want computer skills he doesn't have.
"Employers are crying that they can't find qualified help," he said. But the ones he interviewed with "weren't willing to train anybody."
From late 2007, when the recession began, to early 2010, the number of people receiving unemployment benefits rose more than four-fold, to 11.5 million.
But the economy has remained so weak that an analysis of long-term unemployment data suggests that about 2 million people have used up 99 weeks of checks and still can't find work.
Contributing to the smaller share of the unemployed who are receiving benefits: Some of them are college graduates or others seeking jobs for the first time. They aren't eligible. Only those who have lost a job through no fault of their own qualify.
The proportion of the unemployed receiving benefits usually falls below 50 percent during an economic recovery. Many have either quit jobs or are new to the job market and don't qualify.
Today, the proportion is falling for a very different reason: Jobs remain scarce. So more of the unemployed are exhausting their benefits.
Federal Reserve Chairman Ben Bernanke has noted that the long-term unemployed increasingly find it hard to find work as their skills and professional networks erode. In a speech last month, Bernanke called long-term unemployment a "national crisis" that should be a top priority for Congress.
Lawmakers will have to decide whether to continue the extended benefits by the end of this year. If the program ends, nearly 2.2 million people will be cut off by February.
Congress has extended the program nine times. But it might balk at the $45 billion cost. It will be the first time the Republican-led House will vote on the issue.
28 Comments so far
Show AllSo 9.1 is not an accurate measurement. Why then is so much of the financial market based on an innacurate measurement? The whiz kids on Wall St. don't understand that? Or is it that they wish to cover it up? Or is it that the employment of the rest of us doesn't really matter to them. After all they still have their jobs.
Back when Clinton cozied up to Wall Street to pass NAFTA & other such things, the official measurement stopped applying to the number of unemployed & included only those receiving unemployment benefits, largely to make it look as if America had less unemployment than Europe, when the real numbers were close . . .
Revising the way the rate of inflation and the way unemployment rates are calculated actually changed during Ronny Raygun's first term and was supported by Dims and the GOP since the Dim's Jimmy Carter lost the 1980 election in part due to high inflation and unemloyment rates, and since the GOP's Gerald Ford lost the 1976 election in part due to high inflation and unemployment rates.
Raygun also devalued unemployment benefits by taxing benefits for the first time in history with his 1986 "tax reform".
What's left, steal, sell drugs or join the military?
"What's left, steal, sell drugs or join the military?"
Steal or sell drugs and chances are you get to work in a for-profit jail for 20 cents an hour, so the military option looks far more promising.
unless, like me, you're too old, in which case you embrace non-entity status or blow your head off, which is increasingly common in my demographic. I already know two people that I've worked with in the past that called it quits permanently.
It's frigging murder.
Doctor assisted suicide is legal only in Montana, Oregon and Washington'
Homelessness or self inflicted suicide is therefore the only option for the hopelessly unemployed and those who are bankrupted by medical bills in the other 47 states
Drone, I am sorry that you experienced that.
I too lost my job in March and I am over 50. My job went digital so the docs don't need someone who knows anatomy any more.
Sad. Everyone saw this coming with NAFTA, and that POS Obama just did 3 more trade deals.
Now he is blaming the thugs, when just as many dums voted against his bill.
This country is going down in flames.
The people that run or ruin this country should be charged with treason.
Giving billions to other countries while millions of us starve.
Disgusting.
OWS!
However, then you'd have to kill people. Stealing and selling drugs is a more moral option even if it does mean prison. Few people can live with themselves if they murder someone even legally. I couldn't. Many soldiers can't either.
This is a national crisis and the Republicans in Washington couldn't care less, some Democrats as well. I have this sick feeling there will be many tragic stories coming this winter.
"some" D's?
.
Or ... all the D party leaders and most of the rank and file?
this proves giving those tax cuts for the last 12 yrs. to the RICH JOB CREATORS has worked
Tax cuts have worked to create the widest wealth gap in US history.
I think the 2 million figure this article quotes as an estimate of the number of folks who've exhausted their maximum 99 weeks of unemployment benefits (or ran out 90 weeks or more with shorter cut-off dates for UI benefits in various States that don't extend the 99 week maximum) is off by about 3 million people.
I'd put the real figure right around 5 million. I don't think the computations cited for the 2 million figure include the millions who've exhausted available UI benefits and given up looking for work because of lack of jobs within their transportation reach.
The federal government and corporate media are covering up the true extent of unemployment and the actual number of homeless people. We are being made to guess at the total number of homes already foreclosed and in the pipeline to be foreclosed, and the amount of bad mortgage (and other derivatives) paper still held by our "too big to fail" banks.
The Eurozone economy keeps trying to fail every other week, with smug corporatists here and there sedately commenting on round after round of "austerity" being shoved down the throats of working-class and poor Greek people. Now the IMF and EU Central Bank are putting Italy's economy under their microscope.
Listened to the Republican candidates OR Obama's "policy fix ideas" for the economy lately? Watched the Republi-Bagger assault on unemployment benefits at the State level? Or Dimcrap mayors' police assaults on the Occupy movement? Taken a look at the Dimocrap's proposed cuts for Medicare offered up by Obama-Boehner's Catfood Commission? They are $92 Billion dollars deeper than the proposed Bowles-Simpson cuts. "Decreasing the surplus population" through a fascist lens that views Ebenezer Scrooge and Adolf Hitler as heroes.
PBS "Need To Know," hosted by beady-eyed, rotten tomato-faced, corporate network McNews Zionist and all-around neo-liberal hack, Jeffrey Greenfield, offered up work-sharing (scaled-back working hours for every worker in a given company), and use of unemployment money to fund entrepreneurial start-ups (for the tiny number of people in a financial/educational/training position to take advantage of it) as "solutions" to the economic crisis. Half-assed gibberish.
At the end of "Need To Know" they aired some complete GOP neo-liberal gibberish by Reihan Salam of the National Review. He's so special he got his own complete segment.
On the present path there is going to be major civil unrest in the U.S. between now and early 2013 regardless of which neo-lib/neo-con partisan duopoly maggot infests the White House in Jan. 2013.
Better start getting as prepared to survive as best you can, because things are going to suck royally until the shit completely hits the fan and what went down in Oakland (police riots followed by a general strike) looks like the Bugs Bunny Show in comparison. The neo-lib/neo-con Machine has been playing softball so far. The real crack-downs haven't even begun yet.
Tell us what you really mean, metal! Great raging post, and I'm afeared you're right on. But don't forget the other consequence: employees who are scared to death of becoming one of those tossed out, who'll toady up to any amount of crap from their employers, even more than they do now, exacerbating the zombie-nation problem.
It seems that there are the "deserving unemployed", that is those who are defined as having lost their jobs through no fault of their own and can thus get benefits and extensions of benefits. And then there are the others who no longer have jobs but were not deserving enough to get unemployment for various reasons and cannot get benefits and will not benefit from any extensions.
While I am glad that Congress has had compassion(?) for the "deserving unemployed" and has extended their benefits and hopefully will do so again, I think that it is time for Congress to have some compassion(?) for at least some of the "undeserving unemployed" who might have become "undeserving" due to some rather minor infractions against the system. I will stop being sarcastic here.
In my opinion it is time that we stopped dividing up the unemployed into these two groups and recognized that in times of massive unemployment that unemployed is unemployed. It is time to recognize that the system of paying benefits for the unemployed has been redesigned to a large extent to keep the workers more docile for the employers, this being done by punishing employees who lose their jobs for almost any reason other than the employer downsizing or imposing layoffs.
Over the past few decades the rich have been given tax breaks and have accumulated much reserves. One big justification for those tax breaks we were told was that it would help create jobs. We are not seeing those jobs though we can see the wealthy and their corporations hoarding the money that they got that was supposed to tempt them to create the new jobs. Somehow the carrot approach does not seem to be working all that well here.
It is time to use the stick of taxation on the wealthy. The majority of the unemployed are quite familiar with the stick in its various forms, and the wealthy understand the principal quite well as they use it against us. It is time to call for their stagnant wealth to be taxed to be used to put the unemployed people back to work. Some of the wealthy no doubt are investing their wealth in ways that put people back to work and those wealthy would deserve to get some tax credits to offset the tax being called for here. But for the majority of the wealthy who are sitting on their wealth and not hungry enough to be motivated by carrots it appears that we need the stick of taxation to either get them to make the needed investments, or to get the money needed by the governments so that the governments can put people back to work. (I see little sanity in the government borrowing money from the banks and the wealthy in order to use it to put people back to work).
@memento
Very astute observation about unemployment benefits only going to the "deserving" unemployed who were both previously employed for a minimum period of time and became unemployed through no fault of their own.
Unfortunately, we live in a business-dominated society where everything, even social programs run by the government, can only be administered upon a showing of sufficient allegiance to the corporate-dominated system. Recent college graduates and everyone else who hasn't yet proven his or her allegiance to the system can go scrounge for food stamps and apply to the hospital for charity care if something bad happens. That is, if they can manage to qualify for either of those meager programs.
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Yeah, metal, you're quite right about the number of long-term unemployed being significantly understated in this article. The rest of your post is pretty spot on as well. Nice job.
I like your writing style metal. I agree about the crackdowns, but the people united will never be defeated, and the austerity in the face of tone deaf idiocy by the compromised fully chained lap dogs of Wall Street who are occupying the elected offices and their blind allegiance to the military industrial complex is going to result in tens of millions of people who are hungry with no place to go but the streets.
I am working as a substitute teacher this year. I have been out of the classroom for 15 years. I was surprised to find the story we read aloud from the Addison Westly reader the other day in a 5th grade class had as its heroes a family who were Torreys during the American Revolution. The bad guys were Minutemen who came and raided their farm to get money and provisions for the Revolution. I took the opportunity to teach the kids about guerrilla warfare and how it was improvised by the American revolutionaries that fought for freedom against the Redcoats of British imperialism, which was the sort of lesson one found about the American Revolution when I was in school. Painting a family who was loyal to the British king during the American Revolution in a positive light was quite a switch. Is that an example of calculated Orwellian revisionism? The textbook is the adopted one of the State of California and is used in nearly all public schools throughout California.
So if a person is unemployed long enough he is no longer unemployed? In
Corporate America, poor human beings can have their "personhood" revoked.
Pretty much. The unemployed will "age out" of the unemployment statistics, just like they will "age out" of unemployment compensation.
Problem solved! Who needs a stimulus when you can just grind people into a permanent unemployed underclass?
How about the reporter doing a little research into how other countries structure unemployment compensation? It is my understanding that there is no time limit in Germany, for example. You receive help until you are able to find work.
I was asked by a local non-profit to serve as director of our little village's after school youth center. I was working on a "contract" basis, although there was never actually a contract. This allowed the non-profit to avoid paying Social Security taxes. When the executive director of the non-profit took off with all the funds all of us were laid off immediately, with no notice. Because we were "contract" workers we were not eligible for unemployment benefits. We were therefore not counted as unemployed, we were just out of a job.
More and more companies are hiring people as contracted help so they don't have to pay FICA taxes. When you're contract help the government considers you self-employed which means you are screwed even though you have contributed the employer's share and individual share which amounts to around 14%.
Heavyrunner - There are rules that specify what it means to be self-employed.Those include, what you do, where you do the job, how you do it and who controls these things. If you do it at their place, with their equipment, according to their instructions at a time they specify, then you are not 'self-employed' and you can file a complaint with the IRS and perhaps others.
This sounds like what you need. "If you classify an employee as an independent contractor and you have no reasonable basis for doing so, you may be held liable for employment taxes for that worker (the relief provisions, discussed below, will not apply). See Internal Revenue Code section 3509 for more information."
http://www.irs.gov/businesses/small/article/0,,id=99921,00.html
You may be able to contest your classification and then file for UE benefits. Don't let them get away with this. Get what's yours.
Occupy is the only option.
The Repub congress sure didn't mind paying billions for war. But, then, sociopaths do tend to hate helping people and love hurting them. helping them is a forms of socialsim(so is Christianity but they're too slow to *get* that,) don'tcha know.
"Federal Reserve Chairman Ben Bernanke has noted that the long-term unemployed increasingly find it hard to find work as their skills and professional networks erode."
not to mention the affects of shrinking job market. also, gov accounting fails to consider all those fresh high school and college grads who have never found that first job, so they don't figure in to the %unemployed equation. bernanke! why dah hell is anybody quoting you? you've missed the boat all along the way.
we proudly refer to ourselves as a developed nation and wonder why the jobs pop up in the developing nations and not here. the very word "developed" indicates a state of completion and to the monopolistic venture capitalist bent on continuously maximising profits, those developing nations or expanding economies offer the best chance for continued profiteering.
so, the u.s. has taken capitalism to its final destination. "everything's up to date in kansas city. they've gone about as fer as they can go!" perhaps we should try something all together new, (to us), something that promotes life, something less stressful than the rat race, paper chase. solutions abound, but we won't see them until we examine the situation from every possible angle.
I just don't understand all of this unemployment. There are plenty of $8/hour jobs out there. At 40 hours a week, this amounts to a whopping $16,640 a year. Even more with overtime. Of course lots of those jobs are part time, but still, with two earners a family of four ought to get by quite nicely on that $16K a year. Right? RIGHT? Reverend Wright was right.