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Wednesday, October 26, 2016

The percentage of unemployed workers receiving unemployment insurance (UI) has reached its lowest point since 1987, according to the Economic Policy Institute.

During the Great Recession, which technically ended in 2009, unemployment spiked. As the EPI reports, “the UI recipiency rate reached about two-thirds of all unemployed workers” during this time.

The number of people receiving UI then fell precipitously in 2012 and 2013, because of unusually long-lasting unemployment bouts and cutbacks to UI funding made at both the state and federal levels. Throughout most of the economic downturn, Emergency Unemployment Compensation (EUC) made it possible for the unemployed to receive additional benefits. UI usually lasts for 26 weeks, but the EUC program allowed unemployed workers to collect UI for at least seven additional weeks (sometimes longer, depending on the state). However, this program ended in December 2013, after Congress refused to pass legislation to extend it.

Many conservatives believed that ending long-term unemployment insurance would benefit the unemployed.

“When you allow people to be on unemployment insurance for 99 weeks, you’re causing them to become part of this perpetual unemployed group in our economy,” Senator Rand Paul (R-KY) claimed in December.

The evidence strongly disputes this claim.

Republicans often cite recent job growth as proof that their opposition to extending long-term unemployment benefits is correct. However, experts believe that job growth has prevailed in spite of — not because of — ending the benefits. The number of long-term unemployed dropped this summer, but there are still 3.1 million Americans who do not qualify for UI looking for work. That number is over 30 percent of the nation’s total unemployment rate. To make matters worse, the recent drop in the number of long-term unemployed can be explained by the surrender of those unemployed workers.

Alan Krueger, a Princeton professor and former member of the Obama administration, conducted a study that found that between 2008 and 2013, only 22 percent of long-term unemployed workers had found a full-time job, while 35 percent had stopped looking for work. This resignation is understandable considering that, as of July, job openings were available for less than half of all job seekers.

Data Viz LTUE  KruegerCramerCho  01
Photo via

The historically small share of jobless people receiving UI means that many of those who cannot find work (or have given up doing so) are receiving no aid.

This could be harming the economy. The Congressional Budget Office has long said that extended benefits boost the economy by increasing consumer spending. The UI system also helps sustain consumer demand through periods of economic downturn by providing money for families to spend.

Photo via Flickr

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  • charleo1

    The Republican response to the Wall Street born Great Recession of 2007, has been nothing less than deplorable, and stupid. If one assumes they are governing in the best interests of the people they claim to be representing. The logic, if we deduce they are indeed using logic. Would indicate an ends justifies the means, mentality. And a Party before all else, stratagem. This is a risky course to set out on. To willfully decide to turn their collective backs on a good number of their core constituency, Seniors on a fixed income, rural Whites, who’s small town economies were already in trouble, due to many local factories moving offshore. And the tens of thousands of small businesses, the financial crisis had served to make their dire situation worse. Also, this wrench they decided for political reasons to intentionally throw into the wheels of an already weakened economy, caused them to have to reject as liberal heresy, a good deal of the initiatives they themselves had enacted over the years, to increase spending in the markets, and the necessary jobs that would be created to meet that increased demand. But not this time. Not this Republican Party. After bailing out the banking, and financial sector, by putting the Gov. on the hook for their reckless, high rolling. They rolled up their sleeves, and concentrated all their best efforts in preventing a general economic recovery, for the other 99%. Since they didn’t control either chamber of the legislature, having been thrown out by a public tired of their war mongering, incompetence, and their proliferate, and irresponsible spending. And too, the deregulation they pushed to enact, that allowed the behavior that cause the financial crisis in the first place. So they turned to the procedural filibuster in the Senate to obstruct any and all efforts to set the economy back on a path to growth. And then, built their mid-term campaigns on what they called, the slowest economic recovery in the Nation’s history. To which I say, well play scum balls. But what is done in the darkness, will always come into the light. And your treasonous behavior, already on record, in this willful act against the American people. I predict, will haunt the once prudent conservative Right, to the end of their days. And rightly so.

  • Whatmeworry

    The data shows just the opposite of what the author intended. One only need to look To Merkle and Germany. There she cut the duration and size of UE benefits. Results dramatic drop in unemployed and better job creation.
    Remember there workers “pay” for their benefits

  • pmbalele

    I have told people not to vote for Repubs and TPs in November. These want
    long-term unemployed dead to save on deficit. You remember what their WH
    candidate, Romney, said about poor and unemployed people? “That is not my problem-let them suffer.” So Repubs and TPs have taken that as modes operandi. You remember democrats in the Senate voted to extend unemployment last year. But once it got in TP/Repub controlled Congress John Boehner would not dare put to vote. He and his friends in Congress wanted long-term unemployed dead. As Chris Christie said: “Repubs don’t have a soul.” So don’t vote for TPs and Repubs in November.