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Cutoff of federal jobless benefit extensions would affect 400,000 Californians

by AirTalk®

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Job seekers use computers to search the Internet for jobs at the East Bay Career Center in Oakland, California. Justin Sullivan/Getty Images

As U.S.businesses felt the pinch of the recession, downsizing or even closing their doors, many American workers found themselves applying for unemployment benefits. But as temporary layoffs stretched from weeks into months, the ranks of the unemployed swelled, straining the limits of state-funded assistance. This prompted the federal government in 2008 to step in to staunch the bleeding with temporary emergency extensions of up to 73 additional weeks.  

In California, which provides 26 weeks of state assistance, that meant a maximum total of 99 weeks. Some economists say that the extra benefits have contributed to a down economy by keeping people from taking available jobs.  But for many of the over 2 million Americans currently relying on federal unemployment extensions, it’s their only hope for staying afloat as they continue to search for work.

Now, even those extra payments have been exhausted by well over 900,000 Californians.  And if congress doesn’t act to extend the federal lifeline, 400,000 more will see an abrupt end to their benefits on December 29th, even if they haven’t exhausted the current federal maximum.

The job outlook has improved slightly, but millions are still looking. With so many breadwinners dependent on the federal program, how will the cutoff  affect California’s economy?  Has the federal extension helped ease your road back to employment? If you’ve been relying on those checks, how can you avoid your own fiscal cliff?


Jordan Levine, economist and director of economic research, Beacon Economics

Liz Pulliam Weston, personal finance columnist for and author of "Easy Money," "Your Credit Score" and "Deal with Your Debt"

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