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. Early last year, 75 per cent were receiving checks. The figure is now 48 per cent—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 US$22,314 for a family of four. The proportion of the unemployed receiving benefits usually falls below 50 per cent 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. 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 programmes. 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 per cent 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 per cent.
AP
