Desperate times for millions: No jobs, no benefits
- Christine Owens: Jobless rate at 9.8 percent, bad news for millions looking for work
- Congress let unemployment benefit lifeline run out for millions of jobless, she says
- Owens: People jobless for longer and longer periods of time; retirement, savings gone
- Each dollar spent on jobless benefits creates $2 in economic activity, she says
Editor’s note: Christine L. Owens is the executive director of the National Employment Law Project. A long-time employment and civil rights attorney, Owens previously served as public policy director of the AFL-CIO. During the 1990s, she led the broad coalition of labor, religious, civil rights and community organizations that won passage of the 1996 federal minimum wage increase.
(CNN) — Just as the economy started showing a few hopeful signs of improvement — a brisk kick-off to holiday shopping, fewer people filing unemployment claims — the Department of Labor reported Friday that a paltry 39,000 jobs were added in November and the unemployed rate rose to 9.8 percent. This news could not be worse for the economy and the 15 million unemployed Americans who desperately want to work.
It’s bad out there, and Americans know it. With just one job opening for every five unemployed people, it doesn’t matter how many hundreds or thousands of resumés someone sends out — the jobs just aren’t there. For 19 months in a row, unemployment has sat above 9 percent, where it is expected to remain through 2011. Even temporary hiring, while up last month, was still less than half the growth we experienced this time last year, when the retail sector hopes to get a boost from the holidays.
What’s more alarming than the grim jobs report, however, is the fact that Congress allowed the federal unemployment insurance lifeline to millions of jobless Americans expire earlier this week. If these programs are not renewed through 2011, 2 million people will be cut off in December alone, and at least 7 million more next year.
This is nothing short of a terrifying prospect for someone who is unemployed. Today, the average unemployed person is without work for nearly 34 weeks, or about eight months, and many face stretches much longer. About 42 percent of the unemployed — 6.3 million Americans — have been out of work for six months or more, and the ranks of the long-term unemployed keep growing.
With their savings depleted, retirement funds likely cashed-in and spent, the reality of long-term unemployment means that millions of Americans are trying to get by on just $290 per week, the average unemployment check, to cover all of life’s necessities — food, mortgage and housing, transportation, kids.
At roughly one-third the average salary, and less than the average person spends on housing alone each week, it’s hardly lavish, but for millions of families it is the sole thing allowing them to make ends meet and feed and shelter their children while they look for work.
Many try to paint the long-term unemployed as lazy and happy to stay at home “enjoying” their $290 per week. But the reality couldn’t be further from the truth. It is a painful existence marked by deprivation and sacrifice, but at least it allows families to keep afloat until the economy improves and jobs return.
Robert Horvath of Glenview, Illinois, is a 58-year-old banking professional who was laid off in June and is one of thousands who’ve shared their heartbreaking story with us at UnemployedWorkers.org. Despite decades of work and business experience, Robert has applied for all types of jobs without any offers. His unemployment insurance has enabled him to maintain health insurance coverage for himself and his wife, but the COBRA payment takes $1,200 of his monthly $1,500 in unemployment benefits.
“Unless Congress acts to continue the expanded benefits program, I’ll have my unemployment benefits cut off in December,” Robert says. “We’d lose our insurance right away, perhaps our home next. I’ve applied for all kinds of positions — but at my age, well, there’s an awful lot of competition out there for very few jobs.”
Those who lost their jobs after May face a particularly daunting battle if the programs are discontinued — most of them would receive no more than 26 weeks of state unemployment insurance, and then lose any further federal support amid unrelenting levels of unemployment.
Despite the grim outlook, there are things we can do to keep steering the economy in the right direction — namely, create more jobs. And one of the most effective ways to do that is to keep the federal unemployment insurance programs up and running through all of next year.
Every dollar spent on unemployment insurance generates roughly $2 in economic activity, the Department of Labor and Congressional Budget Office have both found, because unemployed workers spend the money immediately. This spending keeps people working in our local grocery stores, gas stations, small businesses and utility companies.
While the cost of these programs is real — renewal through next year would run about $56 billion — the cost of doing nothing is far greater. On Thursday, the President’s Council of Economic Advisors estimated that losing the federal unemployment insurance programs could cost the country 600,000 more jobs by the end of next year, and economists across the board agree that scaling back now would only make things worse.
The same people who argue that we can’t afford to support the long-term unemployed with meager benefits also contend that we can afford $700 billion in debt-financed tax cuts for the wealthiest 2 percent of Americans — claiming that they will also stimulate the economy, even though the Congressional Budget Office has found that those cuts are the least economically stimulative activity being contemplated. The rank hypocrisy of such a position should offend everyone’s sense of logic and decency.
Members of Congress on both sides of the aisle have introduced proposals to keep these programs going through the end of 2011. With the expiration already passed, it’s time they get to a vote. If you’re like many Americans who want to help and think it’s the right thing to do, call your local Congress member.
Today’s jobs news was a blow to the economy — and it means that we, as a nation, cannot afford to let congressional gridlock and misplaced priorities delay our recovery any longer than it already has.
The opinions expressed in this commentary are solely those of Christine Owens.
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