Dec. 28 expiration on long-term aid leaves unemployed anxious
BY MAUDLYNE IHEJIRIKA Staff Reporter December 21, 2013 3:12AM
Randy Russo of Chicago, poses for a portrait inside his home on Thursday, December 19, 2013. In March Russo was laid off from his graphics printing job and since then has filled out hundreds of job applications with not one interview. | Michael Jarecki/For Sun-Times Media
Updated: January 23, 2014 6:29AM
This year has seen a trifecta of challenges for Lynn Richards, 30, of Elgin.
In April, she was laid off from her manufacturing purchasing job of 3½ years.
Her unemployment insurance kicked in, then she became pregnant during her job search.
Now Richards, who is married with a son and hasn’t yet found work, is among 80,000 Illinoisans expected to lose federal Emergency Unemployment Compensation on Saturday.
“I’ve been working since I was 20. I’ve never had this much trouble getting a job in my life. I’ve applied to like 200 places. I’ve gotten less than 10 calls and a couple of interviews,” she said. “Unfortunately now, no employer wants to hire someone [who is] pregnant.”
An estimated 1.3 million Americans who are the long-term unemployed are due to have their benefits cut off just after Christmas because Congress didn’t extend the recession initiative in its compromise budget bill passed by the Senate last week.
Another 1.9 million currently receiving state jobless benefits due to run out the first half of 2014 also will be affected, as they would have qualified for the federal compensation.
“It’s terrifying. We live paycheck to paycheck. I’m stuck between a rock and a hard place and have no idea what we’re going to do when they cut me off,” Richards said.
The bipartisan, $85 billion budget legislation headed to President Barack Obama’s desk uniquely avoided a government shutdown but sidestepped the unemployment lifeline.
Nationwide, the unemployment rate has fallen to 7 percent from a high of 10 percent in 2010. Despite the recession’s technical end, an estimated 11 million Americans still are seeking work — 4 million of those workers have been looking for more than six months.
“We’re talking about workers and their families who are, by definition, stretched to the limit financially. They’ve run out of state benefits so they mostly have little or no other income to get by,” says Maurice Emsellem, program director of the New York-based National Employment Law Project. “Ending EUC is going to have an irreparable impact.”
In Illinois, which is among states with the highest unemployment rates, joblessness remains at 8.7 percent. It is among few states where workers qualify for the maximum 47 weeks of federal benefits atop 26 weeks of state benefits, due to high unemployment.
Richards and the 80,000 others in the same situation will receive their last payments when they certify for benefits in early January, according to the Illinois Department of Employment Security.
Some 109,000 workers receiving state unemployment benefits won’t be immediately affected; however, 36,000 of those will have those benefits run out in early 2014.
“While today’s job growth allows most newly unemployed individuals to find work after several weeks, the long-term unemployed face additional hurdles,” IDES Director Jay Rowell said. “Ending this modest program . . . could slow economic growth.”
According to the Congressional Budget Office, extending the unemployment insurance program would cost an estimated $25 billion through 2014 while providing a small boost to the nation’s economy.
Studies show $1 in unemployment insurance generates between $1.63 and $2 in economic activity. In Illinois, the average weekly benefit payment is $320; the maximum weekly family payment, $562. And according to Emsellem’s group, the aid pumped $1.35 billion into Illinois’ economy alone last year. Only a few other states received more than $1 billion in benefits, including California, Florida, New Jersey, New York, Pennsylvania and Texas.
“When people get these checks, they don’t buy stocks,” said John Bouman, president of Chicago’s Shriver National Center on Poverty. “It enables them to pay rent, utilities. They go out and buy things in stores, like food, gasoline for their car, transportation to and from job interviews, so that money goes straight back into the economy.”
According to studies, the drop in the unemployment rate is due more to workers leaving the work force and fewer businesses downsizing rather than to increased hiring rates; and workers unemployed for more than six months find fewer employers willing to hire long-term unemployed people.
Richards initially concentrated her job search in her field, but that soon changed.
“I expanded to anything in the office on the administrative side, then ended up taking a part-time job at CVS Pharmacy two nights a week to help pay the mortgage,” she said. “I was trying to avoid retail, but where I work doesn’t even have full-time openings.”
Efforts by Democrats to extend the benefits failed in the Republican-controlled U.S. House, which passed the two-year budget Dec. 12, leaving for Christmas vacation.
The plan was passed by the Democratic-led Senate on Wednesday, with Senate leaders promising to come back at the issue, which Obama supports, in a separate bill in January.
If the benefits program is reauthorized, beneficiaries would receive lump-sum checks for missed weeks of insurance, as has happened several times already since the recession.
Advocates say they hope this happens, but it will come late for some.
“If someone isn’t able to eat right now, or is in a pinch with their landlord, or can’t put gas in the tank to look for a job, that’s not going to help them,” Emsellem said.
Randy Russo, 50, of Chicago’s West Ridge neighborhood, who was laid off in March from his printing/graphics job of 2½ years, is one of those individuals.
“It’s just really rough out here, primarily because there are three applicants for every job. I’ve probably applied to hundreds of jobs, with very little response, and haven’t gotten even one interview,” said Russo, who is single.
Even with his unemployment benefits, he’s been dipping into his retirement savings from 35 years in the printing industry to meet rent and other expenses. He dreads Dec. 28.
“I went to a pre-Christmas dinner with my sister and my nephew who will be out of town next week, and I had nothing to bring to the table. It’s just terrible,” Russo said.
“It’s been sort of a slow leak in my savings, and if the benefits go away completely, then the dike breaks. It’s going to be over. You know, I figure it’s just a numbers game, that if three people apply for the job and only one can get it, eventually that person’s going to be you,” he said. “But you have to survive until then.”