Marketplace has a new podcast for kids, "Million Bazillion!" EPISODE OUT NOW
Fiscal Cliff

Worries grow over cuts to unemployment aid

David Gura Nov 26, 2012
HTML EMBED:
COPY
Fiscal Cliff

Worries grow over cuts to unemployment aid

David Gura Nov 26, 2012
HTML EMBED:
COPY

It used to be that you could get unemployment insurance for just six months. During the recession, Congress extended that, to a maximum of 99 weeks. That and subsequent extensions have cost the federal government an additional $384 billion.

“That is due both to the extended length of time that people could receive [benefits],” says James Ziliak, the Gatton Endowed Chair in Microeconomics at the University of Kentucky. “But it is mostly due to the fact there are just so many Americans who fell into unemployment.”

Last month, the Department of Labor said five million Americans have been jobless for more than six months.

If the U.S. economy goes over the “fiscal cliff” at the end of the year, millions of out-of-work Americans would lose their unemployment benefits. 

The current extension expires at the end of December, and if congress doesn’t renew it, more than two million of those Americans will be unable to collect unemployment insurance.

“Obviously, many of these people continue to try to find jobs, and I have no doubt that they will continue to try to find jobs — even in the absence of any sort of unemployment insurance benefits,” says Matt Freedman, an assistant professor of economics at Cornell University.

But they may have to do that with a lot less help. 

So far, the focus of the “fiscal cliff” negotiations has been on tax increases and automatic spending cuts, not on extending unemployment. 

We’re here to help you navigate this changed world and economy.

Our mission at Marketplace is to raise the economic intelligence of the country. It’s a tough task, but it’s never been more important.

In the past year, we’ve seen record unemployment, stimulus bills, and reddit users influencing the stock market. Marketplace helps you understand it all, will fact-based, approachable, and unbiased reporting.

Generous support from listeners and readers is what powers our nonprofit news—and your donation today will help provide this essential service. For just $5/month, you can sustain independent journalism that keeps you and thousands of others informed.