Jobless Americans are facing a cliff when it comes to their unemployment benefits. As a new report from the National Employment Law Project notes, due to Congress phasing out federal unemployment benefits that were implemented as a response to the Great Recession, U.S. workers who lose their jobs from the first week of July forward will only be eligible to receive 27 weeks of benefits at the state level, not the extended benefits that have been available for the last several years:
The [Emergency Unemployment Compensation] program is scheduled to expire at the end of December 2012. Workers who lose their jobs during the first week of July and thereafter will thus face having no federal benefits when they exhaust state UI benefits. Unlike prior authorizations of the EUC program, which provided for a graduated phase-out of eligibility for workers receiving benefits on the scheduled expiration date, workers receiving EUC at the end of the year face a “hard” cut-off: their benefits will stop. This means that unless Congress reauthorizes the EUC program by the end of December, no unemployed worker will receive any federal unemployment benefits for the weeks after December 29, 2012.
Though the labor market is improving, there are still nearly four unemployed workers for every available opening, and the average duration of unemployment is currently 40 weeks — longer than the 26 weeks of benefits most states provide. Since the recession, the federal government has picked up the tab for up to 99 weeks of unemployment through the EUC program.
If Congress allows the EUC program to expire at the end of the year, more than two-thirds of the unemployed will not be receiving any benefits at all. Even with the federal benefits program, less than half of the unemployed currently receive benefits.