America' Laid off Workers

September 1, 2002

by Rick McHugh

President Bush held an August economic summit where no administration figure even mentioned helping unemployed workers as a response to the continued economic slowdown. Here's some facts President Bush and his advisors must have overlooked:

Over 8 million individuals have been out of work every month since March 2002 and economists don't expect much improvement any time soon.

There were 818,000 persons unemployed more than 6 months just before Labor Day 2001 and 1.533 million in July 2002 — an 87 percent increase in long-term unemployment.

In May 2002, the most recent month reported, there were 2.4 unemployed workers for every job opening in the economy. What does this mean in the real world? Thousands of laid off workers are exhausting temporary extension benefits every week and the federal extension program expires completely on December 31. This means that anyone laid off after June 30 won't have any federal extension in place when their state benefits run out. Workers laid off earlier will have their benefits simply stop. Jobs are scarce. Working families are hurting.

There are few signs right now that this real world of unemployment is impacting the political world in Washington, D.C. Unless the political climate changes when Congress comes back for a short session held between Labor Day and an expected mid-October recess for the November elections, things look bad for millions of America's unemployed and forgotten workers.

Despite our dire labor market situation, long lines at unemployment offices in the 80s have been replaced by filing of claims by telephone today in most states. Unemployed workers have simply disappeared. Too many public officials, economists, and commentators think that the federal government dealt with the unemployment issue last March when Congress passed and the President signed a modest extension package called Temporary Emergency Unemployment Compensation. This temporary program pays laid off workers up to 13 weeks of extended benefits once they have drawn all the regular unemployment benefits that they can (generally 26 weeks). But, this temporary extension program has lots of gaps. Consider these facts:

Over a million workers have lost all benefits (both regular state and temporary federal extensions) since the temporary extension program stared in March 2002.

While 12 states initially qualified for 13 additional weeks of extensions as "high unemployment" states under the temporary extension program, all but Oregon and Washington state had their unemployment levels improve enough to keep that second round of benefit extensions from actually helping long-term unemployed workers in those states.

Over 300,000 individuals have exhausted regular state benefits every month since December 2001. If current unemployment levels continue, that translates to another 2 million workers that will be hit by the December 31 termination of the temporary federal extension, losing from 1 to 13 weeks of benefits depending on when they were laid off. A few folks have started to talk about further unemployment benefit extensions in the last few weeks. In an August 18 appearance on NBC's Meet the Press, AFL-CIO President John Sweeney criticized President Bush's economic summit and called for more help for the unemployed. New York Times columnist Jeff Madrick, Fortune Magazine's Jeff Birnbaum, and former Council of Economic Advisors chair Janet Yellen have recently mentioned unemployment extensions as policy responses to the continued economic downturn.

What will happen next? A positive future is difficult to predict. There are currently bills in both the Senate and House to provide added weeks of temporary federal extensions as well as fixing our outdated Extended Benefits program. A story I recall from the early 90s that gives me some hope that today's laid-off workers may remind our political leaders that they're still around and that their families deserve some help.

In the summer of 1991, several busloads of laid-off construction workers rode from Philadelphia to Washington, D.C. Their trip was organized by the Philadelphia Unemployed Project. Their appearance on Capitol Hill prompted a response that ultimately led to passage of the Emergency Unemployment Compensation program. This program helped unemployed workers from November 1991 until April 1994, providing from 7 to 33 weeks of extensions, depending upon states' unemployment rates at the time. Before it passed, it was vetoed by then-President George H. W. Bush. Once it passed, it was extended four times by Congress. It helped workers and the economy.

Whether or not any further help is coming for today's forgotten unemployed workers is a question waiting for an answer in Washington, D.C. Congress is waiting to see if it hears from the public, including unemployed workers. The next few weeks will tell us if the voices of unemployed workers and their allies will be heard, or if laid-off workers will remain as they are today — not gone, but forgotten.