FedUpUSA

Archive for the ‘Unemployment Benefits’ Category

The economic treadmill is throwing millions out of the middle class and into poverty.  In 2010 75 percent of unemployed received unemployment benefits while today it is down to 48 percent.  From unemployment to food stamps.

The economy is being pulled apart from the center as if two mighty horses on both sides were set to run in opposite directions of the financially strapped middle class.  This seems to be the current trajectory of our economic progress.  The ranks of the poor continue to grow while the financial sector continues to strive based on government favoritism and a strong form of corporatacracy.  Take this startling fact under consideration that last year 75 percent of the unemployed received some form of unemployment benefits. That figure is set to fall to 48 percent this year.  Part of the main reason has been the long-term structural unemployment in our economy.  The current economy resembles two different worlds and most Americans are still feeling the pangs of the recession that began in 2007.  The main question many are asking is where will this country be heading if the same financial sector that created rampant disorder in the last decade is still at the helm of the ship?  We can look at current trends and the results do not look promising.

The super long-term unemployed

It used to be the case that 99 weeks was the extreme end of the long-term unemployed.  But now we are seeing this lack of job growth continue even longer:

Over 30 percent of the currently unemployed have been out of work for one year or longer.  This stubborn unemployment is causing major problems in the fabric of our economy.  Many states have adjusted to provide 99 weeks of unemployment but the number of those not working is so large that 99 weeks is not enough and many fall off the benefit count.  Take for example the proportion of those that are unemployed and receive unemployment benefits:

What this chart highlights is the reality that many of the long-term unemployed are going to fall onto other safety nets like food stamps or other aid.  It is astounding how we can be seeing such structural problems yet the financial sector seems to be booming.  It is booming not because it has earned it in the typical capitalist sense but they have earned it by stealing it.  Unlike the unemployed person that runs out of benefits, the too big to fail simply rewrite laws and call up their Federal Reserve counterparts and draw on their unlimited credit lines.  Of course the burden is then largely place on the middle class that is simply struggling to stay in place without falling further and further behind.

Read the rest at My Budget 360

So today, two bits of news came out: Unemployment declined to 8.9% last February, as the U.S. economy added 192,000 jobs; and the Federal Reserve signalled that it is definitely-definitely-definitely ending Quantitative Easing 2 (QE-2) in June, as originally scheduled, on the assumption that the economy is improving, and therefore no further extension of QE-2 will be necessary. 

Portrait of the author, chewing over what it all means.

On its face, this would seem to be . . . not good news, but at the least encouraging news: The economy seems to be improving, albeit anæmically. 

But is it? 

Stepping on the heels of the Bureau of Labor Statistics release of the employment figures, Tyler Durden at Zero Hedge pointed out that, based on the 25 year average of employment participation of 66.1%, U-3 unemployment ought to be at 11.6%—quite a bit higher than the current 8.9% headline number. 

This points to something that a lot of commentators of the BLS’s numbers have been saying for a while: The number of individuals in the labor market as defined by the BLS has been steadily dropping. But it hasn’t been because of some sudden demographic shock—it’s been because more people have been unemployed for more than two years. 

So-called “Ninety-Niners”—people who have been unemployed for more than 99 weeks, and have therefore run out of unemployment insurance—are dropping out of the BLS accounting for unemployment. 

Calculated Risk had a very clever chart back in December:

Read the rest:  Gonzalo Lira

In what is now 38 times in 2010 (out of 46), the BLS (Bureau of Labor Statistics) has revised its prior weekly initial jobless claims number higher, from 439k to 441k. The most recent  number, which is far less relevant (as it will be revised worse next week) and much more volatile due to it being a pre-thanksgiving week, and layoffs plunge, came at 407k compared to 435k the expectations.

Most importantly, non-seasonally adjusted claims increased by 52.5k.  But of course, the government’s adjustment is where it’s at. Continuing claims were of course also revised higher as the BLS’ charade of beating instant expectations has gotten boring: the prior number of 4,295k was pushed higher to 4,324k, once again confirming that anything the BLS reports has to be ignored until the next week revision. Lastly, the loss of extended claims started early this year, with those collecting extended claims and EUCs dropping by over 280k.

ZeroHedge

Basically, the government would like people to believe that people falling off the unemployment rolls altogether is a good thing.  These are people that still cannot find employment after two years.

True reality looks more like this:

Did you ever think that things in America would get so bad that we would need to put armed guards into our unemployment offices?  Well, that is exactly what is happening in Indiana.  Armed security guards will now be posted at all 36 full-service unemployment offices in the state of Indiana.  So why is this happening now?  Well, Indiana Department of Workforce Development spokesman Marc Lotter says that the agency is bringing in the extra security in anticipation of an upcoming deadline when thousands upon thousands of Indiana residents could have their unemployment benefits cut off.  But it is not just the state of Indiana that could have a problem.  In fact, one recent study found that approximately 2 million Americans will lose their unemployment insurance benefits during this upcoming holiday season unless Congress authorizes another emergency extension of benefits by the end of November.  At this point, however, that is looking less and less likely.

So perhaps all the states will have to start putting armed security guards in their unemployment offices.  The truth is that frustration among unemployed Americans is growing by the day.

Could we soon see economic riots similar to what we have seen in Greece and France?

Let’s hope not.

The following is a video news report about the armed guards that are going into Indiana unemployment offices….

So could things really get out of hand when thousands of unemployed workers in Indiana find out that they aren’t going to get checks any longer?

Indiana Department of Workforce Development spokesman Marc Lotter makes it sound like that is very much on his mind….

“Given the upcoming expiration of the federal extensions and the increased stress on some of the unemployed, we thought added security would provide an extra level of protection for our employees and clients.”

So who is paying for all of this extra security?

The Feds of course.

The additional cost of the new security will be approximately $1 million, and it will be paid for with U.S. government funds designated for the administration of the unemployment system according to Lotter.

This is not a good trend.  As you go through your daily life, just start taking note of the places that now have armed security that did not have armed security five or ten years ago.

Unfortunately, as the U.S. economy goes downhill even further, the amount of security that people feel is “necessary” is likely to go up even more.

So is America going to become an armed camp where the people and institutions with money are protected by armed guards from the hordes of frustrated unemployed workers that can’t feed themselves or their families?

Americans are certainly not in a good mood about the economy.  According to a recent poll conducted by CNBC, 92 percent of Americans believe that the performance of the U.S. economy is either “fair” or “poor”.

The lack of jobs is the main thing that the American people are so mad about.  In fact, it is hard for even highly educated people to find work in 2010.  In America today, 317,000 waiters and waitresses have college degrees. 

People are really hurting and they are getting to the end of their ropes.  Over 41 million Americans are now on food stamps, and one out of every six Americans is enrolled in at least one federal anti-poverty program.  It is getting hard to believe that this is even America anymore.  For many more statistics that reveal the economic horror we are now facing as a nation, please see my previous article entitled ”30 Reasons Why People Should Be Getting Really Nervous About The State Of The U.S. Economy“.

But it is not just unemployment that is the problem.  In recent years, millions upon millions of Americans have been forced to take reduced hours or a cut in pay due to the economy.  Millions of others have had to take jobs that barely enable them to survive.  In fact, the number of Americans working part-time jobs “for economic reasons” is now the highest it has been in at least five decades.

So why aren’t there even close to enough jobs for everyone?  Well, there are a number of contributing factors, including the fact that we have been “offshoring” and “outsourcing” millions of our jobs and now it is really starting to catch up with us.  I have discussed this so many times now that I am starting to sound like a broken record.

But instead of fixing the fundamental problems with our economy, the Federal Reserve wants to print yet another gigantic pile of paper money and throw it at the problem.  It is called “quantitative easing“, and it may help smooth things over for a few months, but it is also going to make our long-term problems even worse.

Unfortunately, the Federal Reserve does not really seem concerned about protecting the value of the U.S. dollar at this point.  Not that they ever did, but it would be nice to see Fed officials paying at least some lip service to the dangers of inflation.

Instead, various Fed officials have been publicly making statements about the need for more quantitative easing for weeks.  Right now they seem desperate to put the American people back to work – even if it ends up crashing the value of the dollar.   

But now even the IMF seems supportive of a dollar devaluation.  On Thursday, the IMF actually said that the U.S. dollar is “overvalued” and that adjustments need to be made.

We’ll see what the Fed decides to do next week.  Most analysts believe that they will announce a quantitative easing program of some sort or another.

But what have we come to as a nation when those who control our economy believe that the best solution to our economic problems is to print another big pile of paper money and chuck it into the system?

We’ve got an absolutely gigantic economic mess on our hands, and none of our “leaders” seem to have any idea about how to fix it.

Meanwhile, millions of unemployed Americans are just going to become more and more frustrated – especially when it gets to the point when they aren’t receiving unemployment checks anymore.

The Economic Collapse

Here is a graph from the Atlanta Fed of the number of people receiving extended unemployment benefits … Note: data as of Aug 7th – there were about 300,000 less people receiving benefits on Aug 14th (most recent data NSA).

Click on graph for larger image.

From the Atlanta Fed:

The number of persons receiving extended benefits has shot up in the weeks following the reinstatement of the emergency unemployment compensation (EUC) program.

Note: As people exhaust their regular benefits, they move on to receive extended benefits first through the federal EUC program and then their state’s extended benefits (EB) program.

• The number of persons receiving emergency unemployment compensation (EUC) has increased by nearly 1.6 million in the three weeks since the program was reinstated on July 22, 2010. For the week ending August 7, the number of claimants reached 4.9 million.

• Extended benefits (EB) claimants increased by more than 300,000 (or 50%) during the same period. There were 937,000 people claiming extended benefits for the week ending August 7.

• Currently, up to 73 weeks of benefits extensions are available including both the EUC and EB programs (53 weeks of EUC and 20 weeks of EB).

That is an increase of almost 2 million people receiving aid since the program was reinstated.

There are another 4.1 million people receiving regular unemployment benefits (NSA). So the total is close to 10 million (NSA). 

CalculatedRisk