Extending Unemployment Benefits
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MARGARET WARNER: Though the country’s unemployment rate was falling last month, businesses cut nearly 90,000 jobs, and job losses the previous three months were even greater. The newly unemployed enter a system that is itself the subject of much debate. Betty Ann Bowser reports.
CLARIETHA ALLEN: This says final demand.
BETTY ANN BOWSER: For Clarietha and Don Allen, paying monthly bills has become a daily struggle. Some bills will be ignored; others cannot.
CLARIETHA ALLEN: This is the electric. And let’s we… We got to pay this by the 10th.
BETTY ANN BOWSER: Last fall, Clarietha Allen was laid off from her job at a managed care company. Since then, she’s been collecting $260 a week in unemployment insurance benefits. Last month, the gas in the Allen’s tiny Atlanta apartment was cut off.
CLAREITHA ALLEN: It’s been extremely stressful for us. We’ve been behind in our bills, and we’ve had to really… We’ve been on a very tight budget.
BETTY ANN BOWSER: Allen’s checks will expire in April, but they may get some relief. The White House and Congress are debating proposals to extend payments for workers who have lost their jobs because of the current recession.
CLAREITHA ALLEN: I have to have more time. I don’t know what I’m going to do.
SPOKESPERSON: You got your papers, right? You’re going to apply for unemployment today, right?
MAN: I already did.
SPOKESPERSON: You have no income coming in right now?
BETTY ANN BOWSER: The whole debate about helping workers has brought new attention to the nation’s unemployment insurance system, a system some say is in dire need of reform.
SPOKESMAN: Our greatest primary task is to put people to work.
BETTY ANN BOWSER: The unemployment insurance system was created in 1935 to help laid off workers pay their bills while searching for new work. On behalf of workers, employers are required to contribute to a trust fund. The states then decide who is eligible for checks. In Georgia and other states, that means a worker must be full time. The average payment last up to 26 weeks.
SPOKESPERSON: Have you all had any layoffs down in Jessup?
BETTY ANN BOWSER: Georgia state representative Nan Grogan Orrock supports federal proposals to extend payments, but she says the real problem with the system is that most unemployed people in Georgia aren’t receiving checks at all.
NAN GROGAN-ORROCK, (D) Georgia State Representative: We were down to having only 22% of our unemployed workers accessing that fund. That’s… That’s just about one out of five working families that are between jobs that are unemployed being able to draw an unemployment check. Women, low-paid workers, minority workers, were ill-served, were often denied because of the terms of their employment and where they are in the workforce.
BETTY ANN BOWSER: Georgia is not unusual. Less then half of all unemployed workers nationwide receive them, and that number has dropped significantly since the 1950s. Critics say that’s because the nation’s workforce has changed. Workers today don’t fit the traditional idea of laid off employees, and therefore don’t qualify to collect checks. The number of part-time workers, many of them women, has increased dramatically. So too has the number of recently hired low-wage workers. And the rise of two-income earning families has meant more people quit their jobs when there’s a family crisis. Orrock wants to pass legislation in Georgia to include those workers.
NAN GROGAN-ORROCK: We have a very narrowly drawn law at this point. We are excluding anyone who is seeking part-time work, even though they may have worked a part-time job for 20 years.
BETTY ANN BOWSER: Although Angela Smith worked full time as a nurse’s assistant for ten years, she was denied unemployment benefits when she quit her job. Smith felt she had no choice but to leave when her infant daughter developed a serious heart condition.
ANGELA SMITH: She came home on a breathing machine, a feeding machine. She had to have medicine all day long. She had nurses and therapists coming in; a nurse would come in the morning, a therapist would come in the evening for her breathing, and I had to be here for them to talk to me and explain to me what to do, how to change it and everything.
BETTY ANN BOWSER: Shortly after her second surgery and one month before her second birthday, smith’s daughter, Jaaliyah, died.
ANGELA SMITH: You try to worry about your child and you try not to worry about your bills, but they still calling and stuff so you got all of that on you.
BETTY ANN BOWSER: Under Grogan Orrock’s legislation, Smith would have been able to collect unemployment because she had a compelling life crisis. Instead, Smith, who returned to the workforce two months after her daughter died, says her credit is ruined.
ANGELA SMITH: The bills still going to come, that’s not going to stop, and you still have to pay it and you still have to live and everything. And a lot of people don’t understand that when they call on you, talking about this due and this due. And you tell them what’s happened, and they say they sorry and everything, but they still want to know, “Can you make arrangements?” Or “When you can make the payment.”
NAN GROGAN-ORROCK: This modest unemployment check can be, you know, the wall between a working mom and her family, and disaster of having to put in for welfare check. We want to keep people in the workforce, productively attached to the workforce, and the unemployment system and that unemployment check, that weekly check, is part of how you do that.
BETTY ANN BOWSER: Orrock says Georgia’s trust fund, like others across the country, has become fat from years of a booming economy, and she thinks the time is right now to dip into that surplus. But not everyone wants to relax the rules for unemployment insurance eligibility.
SPOKESPERSON: I’m going to need your help this session.
SPOKESPERSON: Very good, thank you.
BETTY ANN BOWSER: Earl Rogers, a lobbyist for Georgia’s Chamber of Commerce, says the business community worries that allowing people who quit to collect checks may open the door to misuse of the fund.
EARL ROGERS, Georgia Chamber of Commerce: I think it sounds good, but it’s not good because the opportunity for abuse in a system like that is just far too great. How many among us have not experienced some kind of family hardship? When I talk to people about that, nods… See people nod their heads. Everyone has experienced some type of family hardship in their life, but they don’t choose to quit work and have the employer pay for their benefits from here on out.
SPOKESMAN: Do we do that on most of our routine transition or do we just going and end that?
BETTY ANN BOWSER: Efforts to extend benefits also has small business owner Earl Smith worried. Smith has seen a 20% downturn in his air conditioning and heating business since September 11. After 40 years in the business, he recently laid off 12% of his staff. Smith fears allowing more people in Georgia to draw unemployment will ultimately come out of his costs.
EARL SMITH, Small Business Owner: But if you want to bring in another layer of people that’s eligible for other reasons, then you add cost. And cost is something that we look at every day, and we’ve got to meet the conditions and competition in the marketplace. We’re already suffering with a reduction in our business, so we’ve got to meet competition and be there at the marketplace. So where else can we go?
EARL ROGERS: Now is not the time to be pushing for an expansion of benefits when you’ve got to remember why that employee became unemployed to start with. Companies are going through tough times. They have to make tough decisions. Layoff is the last thing they want to do.
BETTY ANN BOWSER: The debate in Georgia is being heard in legislatures across the country as many other states take a second look at the way they administer benefits to the unemployed.