Sequestration Cuts Soon To Hit Long-Term Unemployment Insurance

The automatic budget cuts that went into effect on March 1 will soon begin to affect a new subset of Americans: the long-term unemployed who have been out of a job for more than six months and are dependent on the federal government’s unemployment assistance program.

The federal Emergency Unemployment Compensation program aids workers after they exhaust their state-level unemployment benefits, which typically last 26 weeks. The benefits are modest — about $300 a week on average — and will become even more so this month and later, when sequestration forces cuts of up to 10.7 percent on all benefit checks, as National Journal reports:

These checks — which average $300 a week, without the cuts — go to roughly 2 million people who have already exhausted their regular unemployment benefits, meaning they’ve been out of work for a while. The Bureau of Labor Statistics defines the long-term unemployed as people who have not held a job for 27 weeks.

Moreover, they are people whom the political establishment has largely forgotten. There are no new stimulus programs on the horizon for the long-term unemployed, nor is there anything new to help train them or connect them to jobs. Those still receiving benefit checks will see them whacked by as much as $450 in total between now and the end of the fiscal year in September, according to Labor Department estimates — all due to spending cuts that both parties consider ill-advised and indiscriminate.

The cuts, as National Journal explains, will come at different times based on how they are implemented by states. But in some states, the cuts will carry an even bigger punch to the guts of jobless workers. Eight states have recently made substantial cuts to their own unemployment compensation programs, shortening the amount of time jobless workers are eligible for benefits. That, in turn, reduces the amount of time they are eligible for federal benefits as well, since the federal program is tied to state programs.


The average unemployed worker has been out of work for 35 weeks; 40 percent have been jobless for 27 weeks or longer, meaning they rely on the federal program. But instead of stimulus programs to help create jobs, Congress has focused on cutting the budget, and given that unemployment insurance is good for both workers and the overall economy, these cuts are another misguided policy that won’t just make it harder to be unemployed, but harder to find a job too.