SUSIE GHARIB: As we mentioned, there’s fresh improvement in the labor market. New
claims for jobless benefits held steady at a four-year low this week. But
there are new rules affecting how long out-of-work Americans can collect
those benefits. As Darren Gersh reports, those rules could have a big
impact on millions of families.
DARREN GERSH, NIGHTLY BUSINESS REPORT CORRESPONDENT: When Washington
state and Connecticut surveyed workers who had exhausted the maximum 99
weeks of jobless benefits, the results were disturbing. The National
Employment Law Project’s Maurice Emsellem says roughly two out of three
were still searching for work.
MAURICE EMSELLEM, POLICY CO-DIR., NATIONAL EMPLOYMENT LAW PROJECT:
It’s not accurate to say that folks are hanging out on benefits and that
they could find work whenever they want it. The fact is folks who have run
out of the benefit still can’t find work.
GERSH: Around three and a half million people now qualify for
extended unemployment benefits lasting up to a maximum of 99 weeks. Under
the agreement Congress struck to extend unemployment benefits, beginning
this summer, the maximum benefit will fall to 79 weeks. In September, that
will fall to 73 weeks in states with high unemployment rates. But in most
other states, the maximum benefit will fall to 63 weeks or less. The
Heritage Foundation’s James Sherk says it makes economic sense to gradually
reduce unemployment benefits, which can encourage some workers to search
for jobs that may never come back in hard-hit industries like automobiles
JAMES SHERK, SR. POLICY ANALYST, HERITAGE FOUNDATION: When you have
too long of a benefit, it encourages many workers to search for jobs that
they are unlikely to find and spend a lot of time looking for those jobs —
jobs in your same city, jobs in the same salary range.
GERSH: Economists have debated how much extended unemployment
benefits might add to the unemployment rate. Most come down to a small
impact of roughly half a percentage point. This also remains a very tough
labor market. As labor market researcher Gary Burtless points out, for
every job opening, there are still four unemployed people looking for work.
GARY BURTLESS, SR. FELLOW, BROOKINGS: If a long-term unemployed person
collecting unemployment benefits turns down a job, there is a lot of people
waiting in the queue.
GERSH: Although trimmed back a bit, Congress extended emergency
unemployment insurance benefits through the end of this year. If the
unemployment rate doesn’t come down by then, Congress may be back debating
this issue in December. Darren Gersh, NIGHTLY BUSINESS REPORT, Washington.