NUMBER OF WORKERS WHO HAVE EXHAUSTED FEDERAL UNEMPLOYMENT INSURANCE
BENEFITS PASSES THE ONE MILLION MARKLatest Data Also Show that Long-term Unemployment Situation Remains Serious
by Wendell Primus and Jessica Goldberg
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If you cannot access the files trough the links, right-click on the underlined text, click "Save Link As," download to your directory, and open the document in Adobe Acrobat Reader The number of unemployed workers who have run out of the additional weeks of unemployment benefits that this year’s stimulus legislation provided has now passed the one million mark and continues to climb. New Labor Department data show that by the end of August, more than 1.1 million workers had exhausted their additional weeks of federal benefits without finding work.
Once workers exhaust these benefits, no further unemployment insurance assistance is generally available. Only unemployed workers living in Oregon and Washington can receive any additional unemployment benefits after the benefits they receive under the federal Temporary Emergency Unemployment Compensation program (TEUC) — the program the stimulus legislation established — run out. (Jobless workers in Oregon and Washington may receive up to 13 additional weeks of benefits through the federal-state Extended Benefits program.) More than 99 percent of the 1.1 million workers who have exhausted their federal TEUC benefits qualify for no further unemployment assistance.
In New York, by the end of August, 135,000 workers had exhausted their TEUC benefits without finding work. More than 94,000 workers had exhausted benefits in Texas. Some 75,000 workers had exhausted benefits in Florida, while 70,000 had exhausted benefits in Illinois. (See Table 1 for the number of workers who had exhausted TEUC benefits in each state by the end of August.)
Many workers who have run out of all benefits from the unemployment insurance system face economic hardship. A large number of these workers have been unemployed for 39 weeks or more, and subsisted during those weeks on unemployment benefits that average $254 a week. Unemployment benefits typically replace less than half of a worker’s lost wages. When workers exhaust unemployment benefits before finding work, they receive neither an unemployment check nor a paycheck.
By the end of September, an estimated 1.5 million workers will have exhausted their TEUC benefits. By the end of December, the total is expected to reach 2.2 million.[1]
According to Massachusetts Institute of Technology economist Jonathan Gruber, the vast majority of those who lose their jobs have fewer than two months worth of savings, an amount that is insufficient to finance lengthy periods of unemployment.[2] Since the unemployment situation has not improved since the stimulus legislation was enacted in March (the unemployment rate is as high today as it was then) and the Congressional Budget Office is projecting the unemployment rate will remain at about six percent until the second half of 2003, many jobless workers are likely to face precarious financial situations in the months ahead.
Long-term Unemployment Is Not Abating
One of the best measures of long-term unemployment is the number of workers whose regular state-funded unemployment benefits run out before they find work. Since most workers who get regular unemployment benefits can receive 26 weeks of those benefits, those whose regular benefits run out before they find work usually have been unemployed for at least half a year. And long-term unemployment is generally defined as unemployment that has lasted at least half a year.
Labor Department data indicate that long-term unemployment is much greater than it was a year ago.
- The number of jobless workers who exhausted their regular unemployment benefits in August 2002 was 46 percent higher than the number of who exhausted such benefits in August 2001.
- The number who exhausted their regular unemployment benefits in the first six months of 2002 is 75 percent greater than the number who exhausted these benefits in the first eight months of 2001, and is more than double the number who exhausted these benefits during the same months of 2000.
The number of unemployed workers who exhausted their regular unemployment benefits in the most recent six-month period — the months from March-August 2002 — was greater in every state in the nation than the number of workers who exhausted regular unemployment benefits during the comparable six-month period of 2000. In 31 states, the number of workers who exhausted their regular unemployment benefits between March and August of 2002 was more than double the number who exhausted benefits in the comparable six-month period of 2000.
In 13 of these states, the number of workers who exhausted their regular unemployment benefits over the past six months was at least 150 percent greater than the number who exhausted these benefits during the same six months of 2000. These 13 states are: North Carolina (where the number of workers exhausting their regular benefits between March and August 2002 was 225 percent larger — or more than triple — the number exhausting benefits in the comparable six months of 2000); Colorado (where the number of exhaustees was 218 percent greater); South Dakota (217 percent); Georgia (197 percent); South Carolina (197 percent); Minnesota (176 percent); Vermont (171 percent); Indiana (164 percent); Ohio (162 percent); Utah (159 percent); Wisconsin (159 percent); Massachusetts (156 percent); and Oklahoma (156 percent). (See Table 2.)
Table 1
Exhausting Federal TEUC BenefitsWorkers Who Received One or More Weeks of TEUC Benefits, March-August
Workers Exhausting TEUC Benefits, March-August***
Alabama* 37,401 13,518 Alaska 10,420 3,505 Arizona 31,153 13,199 Arkansas 21,531 9,506 California** 398,917 73,727 Colorado 35,631 16,808 Connecticut 38,407 15,890 Delaware 5,817 2,348 District of Columbia* 10,161 4,856 Florida 154,320 75,045 Georgia 79,056 52,090 Hawaii 13,323 4,041 Idaho 11,254 3,140 Illinois 149,823 71,037 Indiana 52,576 26,057 Iowa 25,220 10,096 Kansas 18,143 5,678 Kentucky 33,075 13,817 Louisiana 30,594 11,717 Maine 9,322 3,579 Maryland 39,522 16,111 Massachusetts 115,493 24,890 Michigan 120,067 50,359 Minnesota 45,454 21,161 Mississippi 28,175 12,800 Missouri 48,086 22,336 Montana* 4,680 1,700 Nebraska* 9,172 3,607 Nevada 22,364 11,267 New Hampshire 4,310 1,774 New Jersey 155,702 24,207 New Mexico 6,675 3,571 New York 264,034 134,992 North Carolina 86,465 36,531 North Dakota 4,359 1,317 Ohio 94,697 44,385 Oklahoma 19,401 9,434 Oregon* 56,595 1,123 Pennsylvania** 174,035 48,192 Rhode Island* 11,572 5,750 South Carolina 46,760 22,128 South Dakota 1,053 414 Tennessee 76,291 36,233 Texas 244,615 94,212 Utah 20,548 7,647 Vermont 3,771 1,281 Virginia 41,712 19,178 Washington 87,661 7,699 West Virginia 10,420 3,783 Wisconsin 54,157 21,982 Wyoming 1,358 1,115 Total 3,065,349 1,120,832 Note: *Exhaustion data for August were not reported in these states. August data were estimated based on patterns of exhaustions up to that point. **Data for exhaustions in California and Pennsylvania are estimates.
*** Numbers for a few other states differ from the numbers reported in a Center analysis issued on September 19. These states have submitted revised data to the Department of Labor.
Table 2
Number of Workers Exhausting Regular Unemployment BenefitsMar-Aug 2000
Mar-Aug 2001 Mar-Aug 2002 Percentage Increase,
2002 to 2000Alabama 13,774
18,660 25,165 83% Alaska 8,714
8,969 10,887 25% Arizona 12,743
14,226 26,048 104% Arkansas 11,769
15,418 22,574 92% California 194,520
199,996 346,898 78% Colorado 10,237
13,828 32,547 218% Connecticut 12,292
13,785 28,013 128% DC 4,256
4,021 10,442 145% Delaware 2,476
3,078 4,992 102% Florida 39,846
50,396 88,986 123% Georgia 19,234
31,556 57,186 197% Hawaii 3,479 3,593 7,401 113% Idaho 6,194 7,564 11,650 88% Illinois 47,118 59,950 108,938 131% Indiana 17,884 31,415 47,184 164% Iowa 8,234 11,024 17,713 115% Kansas 8,575 9,239 17,007 98% Kentucky 9,179 12,825 20,668 125% Louisiana 10,951 13,411 18,127 66% Maine 5,539 4,824 7,064 28% Maryland 13,625 14,822 24,947 83% Massachusetts 28,449 30,887 72,932 156% Michigan 44,359 62,690 94,692 113% Minnesota 13,717 19,149 37,847 176% Mississippi 8,046 11,779 14,968 86% Missouri 19,070 24,179 37,765 98% Montana 3,906 4,204 5,627 44% Nebraska 4,083 5,618 9,495 133% Nevada 10,890 12,866 22,917 110% New Hampshire NA NA 4,594 NA New Jersey 55,913 64,421 104,310 87% New Mexico 4,471 4,898 8,534 91% New York 89,529 108,208 197,698 121% North Carolina 21,846 33,992 71,083 225% North Dakota 2,333 2,277 3,233 39% Ohio 25,263 40,053 66,266 162% Oklahoma 5,813 7,424 14,870 156% Oregon 18,878 24,709 39,979 112% Pennsylvania 49,772 60,783 103,709 108% Rhode Island 6,746 6,653 9,869 46% South Carolina 10,768 17,323 32,015 197% South Dakota 333 459 1,055 217% Tennessee 22,796 35,263 46,361 103% Texas 83,002 94,124 191,530 131% Utah 5,861 7,994 15,198 159% Vermont 1,212 1,400 3,285 171% Virginia 12,734 14,657 30,496 139% Washington 30,606 33,633 58,803 92% West Virginia 4,490 4,902 6,325 41% Wisconsin 19,986 27,562 51,814 159% Wyoming 1,392 1,441 1,933 39% Total 1,096,655 1,335,763 2,333,672 113%
End Notes[1] The total number of workers who have exhausted their TEUC benefits increased from 823,000 at the end of July to 1.12 million at the end of August, an increase of 290,000. This might suggest the total number of exhaustions by the end of September would be 1.4 million rather than 1.5 million. The number of exhaustions in August, however, was lower than the number that is expected in September. Under the TEUC program, workers in “high unemployment” states receive an additional 13 weeks of benefits once they exhaust their initial 13 weeks. Since the TEUC program did not start until March and many states quickly lost “high unemployment” status, only workers in California, Idaho, Massachusetts, New Jersey, and Pennsylvania could actually receive 26 weeks of TEUC benefits. Such workers will begin to exhaust benefits in September. In other words, September is the first month in which workers receiving 26 weeks of TEUC benefits can run out of these benefits. Since California, New Jersey, and Pennsylvania are large states, the number of exhaustions will be substantially higher in September than it was in August.
[2] Gruber, Jonathan. “The Consumption Smoothing Benefits of Unemployment Insurance.” The American Economic Review, Volume 87, Issue 1 (March 1997), 192-205.