A note on the unemployment extension

There seems to be some continuing confusion over exactly what form the unemployment extension takes in the Obama-GOP tax deal.  On every occasion where I have discussed this, people have understood it to mean that unemployment benefits are being extended past the 99-week limit, allowing people to collect another 13 months of unemployment checks.  That’s not actually the case, which I have stated in two earlier posts this week but not as a standalone point.

The extension in this case applies to the entire program, not individual benefits.  Both Gabriel Malor and Calculated Risk have noted the difference.  The emergency federal benefits come in four tiers of Emergency Unemployment Compensation (EUC) and Extended Benefits (EB) that start when state-based unemployment ends, and the number of weeks available for aid depends on the unemployment rate within the state.  Half of the states qualify for both the full EUC (the first three tiers) and the full extended benefits (the fourth tier).

However, without this deal, EUC and EB both end within the next two weeks regardless of how many weeks of compensation people in the system have received.  This deal extends the two programs for another 13 months.  This will allow those in the system who have not yet exhausted their eligibility — up to 99 weeks in half the states but only 60 weeks in five — to continue receiving unemployment.

For instance, a person who has received the standard 26 weeks of unemployment from the state and another 20 weeks through the EUC will continue to be eligible for payments, up to another 53 weeks in half of the states.  Those who have already received 99 weeks, or whatever the maximum is for their state, will still be ineligible for any other unemployment compensation.  The caps remain in place, while the program continues for those who more recently lost their jobs or will lose their jobs in the near future.

There is still a substantial cost to this extension, and no one is sure at the moment whether the GOP will raid what’s left of Porkulus to fund it or not.  However, it is not an extension of benefits to those who have already received 99 weeks of unemployment, and many within the system now won’t qualify for 99 weeks in any event.