off the charts
POLICY INSIGHT
BEYOND THE NUMBERS

New Report Details Job-Creating Impact of Jobless Benefits Extension

A new report from the White House Council of Economic Advisers (CEA) shows why the 13-month extension of federal emergency unemployment insurance (UI) that’s included in this week’s tax-cut compromise between President Obama and Republican leaders is so important. First, a little background.  Federal emergency UI has two parts:  the temporary, federally funded Emergency Unemployment Compensation program (EUC), created in June 2008, and full federal funding for the permanent Extended Benefits (EB) program, whose cost is typically shared between the states and the federal government.  Full federal funding for EB allowed many states to temporarily expand their EB programs.  Both EUC and full federal funding for EB expired on November 30 but, if Congress enacts the tax-cut compromise, they will both be reinstated and continued through December 2011. As for the CEA report, it showed that: Federal UI benefits provide critical assistance to tens of millions of Americans, most of them middle-class.
  • Through October 2010, the federal UI program has reached 14 million unemployed workers, and has indirectly benefited 26 million more people living in their households (including 10.5 million children).
  • The program has helped households across a broad range of incomes, especially middle-class households, which account for two-thirds of all recipients.
  • Without federal UI benefits, the typical recipient household would lose one-third of its income. The loss would be even more dramatic for the 42 percent of households in which the recipient is the sole wage-earner:  UI accounts for 90 percent of these families’ income, on average.
Federal UI benefits provide a significant boost to the economy.
  • In September 2010, the nation’s gross domestic product (GDP) was 0.8 percent ($119 billion) higher, and there were 800,000 more jobs, than there would have been without federal UI benefits.
  • In December 2011, the CEA estimates that GDP will be 0.6 percent ($92 billion) higher, and there will be 600,000 more jobs, than there will be without federal UI benefits.
The table below shows the CEA’s estimates of the employment effect of federal UI benefits in each state:
The Job-Creating Effect of the Federal UI Program
State Estimated Jobs Created by Federal UI Program (in September 2010) Projected Jobs Lost if Federal UI Program is not Extended (in December 2011)
Alabama 5,250 6,900
Alaska 1,400 1,200
Arizona 10,050 11,250
Arkansas 4,850 2,900
California 115,950 89,400
Colorado 11,750 8,850
Connecticut 14,050 7,000
Delaware 1,750 1,500
District of Columbia 2,450 1,050
Florida 43,400 46,850
Georgia 21,600 26,600
Hawaii 2,800 1,300
Idaho 3,050 2,250
Illinois 41,500 25,250
Indiana 19,800 11,600
Iowa 4,950 3,000
Kansas 5,150 3,350
Kentucky 9,700 7,150
Louisiana 3,000 3,450
Maine 2,000 1,650
Maryland 8,650 5,750
Massachusetts 24,950 15,700
Michigan 41,650 26,450
Minnesota 13,300 9,100
Mississippi 3,200 7,700
Missouri 10,000 5,350
Montana 1,400 1,050
Nebraska 1,650 1,250
Nevada 11,350 7,350
New Hampshire 1,650 1,100
New Jersey 51,050 28,400
New Mexico 3,100 2,900
New York 55,200 40,500
North Carolina 27,950 20,500
North Dakota 350 200
Ohio 29,500 21,000
Oklahoma 4,650 3,350
Oregon 14,200 10,050
Pennsylvania 47,200 31,250
Puerto Rico 4,200 7,500
Rhode Island 4,200 2,150
South Carolina 9,850 8,400
South Dakota 200 200
Tennessee 10,600 8,400
Texas 36,400 29,500
Utah 3,800 2,450
Vermont 1,150 450
Virgin Islands 200 50
Virginia 8,000 5,250
Washington 21,100 14,000
West Virginia 2,250 1,700
Wisconsin 15,000 11,150
Wyoming 700 550
TOTAL 793,000 593,000