CHN: Unemployment Benefits Extension Falters

November 22, 2002

House Failure to Act Will Lead to Expiration of Benefits for Nearly One Million Workers By Year’s End

Congressional disagreements over competing versions of a measure to extend federal unemployment benefits were not resolved before Congress’s lame-duck session ended this week, leaving at least 830,000 workers without benefits by the end of the year. On November 14, the House and Senate passed two separate bills that would extend unemployment benefits through the Temporary Emergency Unemployment Compensation (TEUC) Program, which is set to expire on December 28. Created last March, TEUC provides federally funded unemployment benefits to workers who have already used up their state-funded unemployment insurance.

The bipartisan Senate measure (HR 3529) would have extended benefits for 2.1 million workers for an additional three months. By contrast, the House bill (HR 5063) – which would help 800,000 people – would have extended unemployment benefits for only five weeks for those who have not exhausted their full 13 weeks by Dec. 28. Workers in states deemed to have “high unemployment” – currently, only three states – would get an unconditional five-week extension. The Senate bill was estimated to cost $4.9 billion, while the House version would cost approximately $900 million. There is currently $29 billion in the federal unemployment trust fund.

Despite attempts by Senators from both parties to reach an agreement with the House before the Senate adjourned for the year, Republican House leaders insisted that the economy is recovering, and that they would reconsider the unemployment situation in January. Senators urged the President to weigh in with the House on Friday, as it was that body’s last chance to pass the Senate version of the TEUC extension before adjournment. While the White House expressed disappointment in the fact that Congress was unable to reach an agreement, the President did not urge the House leadership to act on the measure.

According to the Center on Budget and Policy Priorities, the December 28 cut-off of unemployment benefits will immediately affect 830,000 jobless workers, with an additional 95,000 workers per week running out of state-funded benefits – and getting no temporary federal relief. The unemployment rate is currently at 5.7 percent. When the benefits end in December, TEUC will have been operating for 10 months; by comparison, Congress extended benefits for 30 months after the 1991 recession and 34 months post-recession in 1982.

Categories: Labor and Employment, Unemployment Insurance