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Nonprofits know this score better than politicians and pundits. Since the expiration of long-term unemployment benefits last December, some 2 million Americans have missed out on the unemployment assistance they had been receiving or were entitled to receive. That is a large city’s worth of people suddenly without a vital source of income. Multiply those 2 million by some factor reflecting other members of their households and you will see that Congress’s failure to renew and extend long-term unemployment benefits has hurt.
While some right-wing ideologues believe these extended benefits make recipients less motivated to look for real jobs, there are both Republicans and Democrats interested in trying to find a way to get some benefits back into the pocketbooks of these workers. The dispute isn’t over whether to support the idea, but how to pay for the cost.
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From 2008, when long-term unemployment benefits were first enacted during the last year of President George W. Bush’s two terms, through the first half of 2013, the U.S. spent $252 billion on long-term benefits for 24 million unemployed persons. Consider John Fugazzie, one of the long-term unemployed since October 2012, when he was laid off as an A&P store manager. During his unemployment, he was receiving benefits of $400 a week—$1,600 a month. The 58-year-old Fugazzie is typical of the long-term unemployed: older, and often highly trained and qualified, but unable to land a job anything like what he once had.
The Great Recession has supposedly passed, but 41 states plus the District of Columbia have long-term unemployment rates that comprise more than 26 percent of the total number of unemployed.
President Obama’s proposed FY2015 budget doesn’t have much in it to deal with the problem of the long-term unemployed. There’s $4 billion for a public-private partnership program to provide training to help them rebuild job skills, but the reality is that long-term unemployed persons are not getting callbacks from employers when they submit their applications. It is entirely possible that the visible decline in long-term unemployment comes not because of new jobs or new hiring, but because after running out of benefits, the seekers are simply leaving the labor force.
The result is a double whammy for the long-term unemployed: no extension of long-term unemployment benefits, plus next to nothing in the federal budget to deal with their distinctive problems in what is, for them, an unending continuation of the recession.—Rick Cohen