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Unmet Need Hits Record Level For the Unemployed: New Data Show End of Temporary Unemployment Benefits Program Is Causing Record Number of Jobless Workers to Go Without Aid

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Publication Date: February 2004

Publisher(s): Center on Budget and Policy Priorities (Washington, D.C.)

Author(s): Isaac Shapiro

Funder(s): Center on Budget and Policy Priorities (Washington, D.C.)

Funder(s): Center on Budget and Policy Priorities (Washington, D.C.)

Special Collection: John D. and Catherine T. MacArthur Foundation

Topic: Labor (Employment and labor supply)

Keywords: Unemployment rate; Job displacement; Economic projections; Economic inequality

Type: Report

Abstract:

With the ending of the federal Temporary Extended Unemployment Compensation (TEUC) program, jobless workers whose regular, state-funded unemployment insurance benefits run out before they can find a job no longer qualify for any federal unemployment aid. An estimated 375,000 unemployed individuals are exhausting their regular unemployment benefits in January without qualifying for any further assistance — and are receiving neither a paycheck nor unemployment benefits. Based on the latest data, nearly two million unemployed workers are expected to be in this situation during the first six months of 2004. (This analysis also includes state projections for the first half of 2004.)

In no other month on record — and in no other six-month period for which data are available — have so many unemployed workers exhausted their regular unemployment benefits without being able to receive additional aid. This finding holds even if the number of exhaustees in previous years is adjusted upward to reflect the growth in the labor force since then.

These findings are based on Labor Department data from 1973 through 2003, and projections based on these data for the first half of 2004. The projections assume modest improvement in the labor market in the first six months of 2004.

In particular, these projections are based in substantial part on just-released Labor Department data for December 2003. Those data show that 395,000 jobless workers exhausted their regular unemployment benefits in December. Most of them qualified for federal unemployment assistance under the Temporary Extended Unemployment Compensation program; that program did not begin to phase out until the week after December 20. Had the TEUC program not been in effect in December, the number of unemployed workers who exhausted their regular benefits without being able to receive further assistance would have been the highest on record.