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Unemployed face a perfect storm

Almost a million lose benefits while layoffs continue and businesses refuse to hire the unemployed

By Masao Suzuki |
June 21, 2010
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San José, CA - On June 18, a Republican filibuster, aided by pro-war independent Joe Lieberman and Nebraska Democrat Ben Nelson, blocked an extension of federal unemployment benefits. The U.S. Department of Labor estimates that more than 900,000 laid-off workers will have had their unemployment benefit checks cut off as of June 19.

Almost half of unemployed workers have been out of work for six months or more, according to the Department of Labor employment report for May 2010. More and more jobless people are running out of the regular state unemployment insurance benefits, which only last for six months. The federal Emergency Unemployment Compensation program adds an additional year of benefits and the federal Extended Benefits program adds another five months. Of the 900,000 unemployed who are being cut off, about half are losing their checks from the Federal Extended Benefits program and the other half are being denied extensions as their benefits run out.

If the Senate Republicans are able to continue their filibuster and prevent the unemployment benefit extension bill from passing, another million jobless workers will lose their benefits by July 10, for a total of two million cut off of unemployment insurance benefits.

Why? Senators opposed to extending unemployment benefits say that they are worried about the large federal government budget deficit. But less than a month ago, the Senate passed a special supplemental bill by a 67-28 margin that gave another $50 billion to the U.S. military. There is a clear double standard at work: long-term wars (Afghanistan is now the country’s longest lasting war, at over eight years and counting) get more and more money, while the long-term unemployed are told that getting cut off will give them more ‘incentive’ to find a job.

In the meantime, companies continue to lay off more workers. The Department of Labor report on new claims for unemployment insurance on June 17 showed an increase of 12,000 new claims, to a total of 472,000 for the week ending June 12. The continued job cuts of almost a half a million workers a week show that the labor market is still weak. To make matters worse, more and more companies are refusing to hire the unemployed. A growing number have even said publicly that job applicants must be employed in order to be considered for a job. Even more refuse to consider applications from the unemployed but do not say so publicly.

Even if extended unemployment benefits are eventually funded by the federal government, more and more jobless workers are reaching the end of the 99 weeks of benefits. In California, the state Employment Development Division reported that 130,000 jobless workers have exhausted the entire 99 weeks of unemployment benefits.

What is really needed is a federal jobs program like the 1930s Works Progress Administration or WPA. This program hired the unemployed to construct schools, bridges and parks throughout the United States (including my high school). Training for new skills was an important goal of the program.