According to the latest data from the Bureau of Labor Statistics, the U.S. unemployment rate is now 8.9 percent. 13.7 million people are currently unemployed, a number which “has grown by 6 million over the last 12 months.” As MarketWatch noted, “of the 13.7 million people listed as officially unemployed, a record 27.2% have been out of work longer than six months.”
With these numbers providing a backdrop, the Wall Street Journal had a piece today comparing the American unemployment insurance system to that of Europe, and the differences are pretty striking. (See chart on the right.) While going as far as Germany is probably going too far, there is definitely room for the U.S. to do more, given the current circumstances.
One step would be to address the pervasion of overly restrictive eligibility requirements for receiving unemployment benefits. As USA Today reported:
While 13.2 million people were unemployed in March, approximately 5.8 million were collecting unemployment benefits at the end of the month…That means less than half of those who were out of work and were actively trying to find a new job were receiving unemployment benefits.
The stimulus package passed in February did provide money for states to ease their restrictions, but the states have to actively pass legislation to receive the funds, which many have not done. As the National Employment Law Project found, “over 300,000 workers will likely be left without any [benefits] despite the full federal funding provided by [the stimulus package] unless certain states with especially high levels of unemployment act quickly.”
President Obama also announced new initiatives today “to help the unemployed pursue education and training, and at the same time keep their unemployment benefits.” Obama encouraged states to update rules “so that the unemployed can enroll in community colleges and other education or training programs without giving up their benefits,” and to allow colleges to make unemployed workers eligible for Pell Grants.
These are smart steps, but until we actually get benefits to all the people who need them, the President’s plans won’t generate the maximum effect. Considering how many people are out of work, and how slow the economic recovery will likely be, there’s no reason for states to perpetuate unfair and outdated benefit restrictions.