Nearly 2 million Americans currently receiving unemployment benefits stand to lose coverage this January if Congress does not extend the emergency federal unemployment insurance program. 24/7 Wall St. has reviewed a study by the National Employment Law Project to identify the ten states where the most people could lose benefits.
The supercommittee was responsible for extending the unemployment benefits. The group was supposed to reach a federal debt-reduction agreement that would have included an extension of the federal unemployment insurance for people who have run out of state-level benefits. Since the supercommittee failed to reach an agreement, the federal programs will expire on December 31 unless Congressional lawmakers renew it.
A similar uncertainty existed last year, before federal benefits were eventually extended. However, a sharply divided Congress may find it even more difficult to extend benefits this year. Rebecca Dixon, policy analyst at NELP, told 24/7 Wall St. that “If Congress fails to renew unemployment insurance benefits, 6 million hardworking Americans struggling to get back on their feet will lose their emergency lifeline. These modest payments are vital to keeping these workers and their families afloat while they search for work in the worst job market since the Great Depression.”
Despite recent declines in the national rate, unemployment is still a huge problem in the U.S. The rate has remained around 9% for three years, well above 2008’s 5% rate. Worst still, 42% of the unemployed are currently “long-term unemployed,” meaning they have exhausted all state unemployment benefits, received before federal benefits and usually lasting for 26 weeks. This accounts for approximately 6 million people. If the federal program expires, 1.8 million people who either currently collect federal benefits or are to begin collecting them in January will be completely cut off.
The states on this list have the largest number of residents who could lose benefits. Many states make the list simply because of their size. New York and Texas, for instance, both have unemployment rates that are below the national average but are among the most populous states in the country. Other states on the list have particularly high unemployment, in addition to large populations. California, for instance, has the second highest rate in the country, and Michigan has the fourth.
These are the ten states where the most unemployed could lose benefits in 2012.