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Business & Economy

Federal budget cuts mean reduced unemployment benefits for thousands

Job seekers line up to enter Choice Career Fair at the Los Angeles Convention Center on December 1, 2010.
Job seekers line up to enter Choice Career Fair at the Los Angeles Convention Center on December 1, 2010.
Kevork Djansezian/Getty Images

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More than 400,000 unemployed California residents will receive less money in their federal unemployment insurance benefits due to sequestration.

The 17.7 percent reduction in weekly benefits, begins April 28.

South Gate resident Cynthia Garcia said money is already tight. She relies on unemployment benefits six months a year. Garcia said any cuts in her benefit will hurt. 

“Pretty much the unemployment (money) - it’s a little bit of gas, a little bit of food, babysitting - and even then it’s not enough,” said Garcia, who is a seasonal worker at Dodger Stadium.

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During the six months she’s not working at the stadium, Garcia said she looks for jobs and receives $92 a week in state unemployment benefits. She said it’s barely enough for Garcia and her four-year-old daughter Jaelene to live on.

“I know there are times when I don’t have money and the ice cream truck passes by,” Garcia said. “My daughter says ‘Mom, can I have ice cream?’ and I say, ‘I don’t have money,’ so she just waves to the ice cream man, like ‘OK. Next time.’”

When her state benefits run out, Garcia may qualify for federal unemployment insurance, which means her meager payments will drop even more.

The cuts will impact people who start receiving federal unemployment benefits on April 28 or later. The unemployed already in the federal program will see a reduction in payments when they start their next tier of funding.

The average federal unemployment payment in California is about $298 a week, which will drop $52 a week due to the cuts, said Loree Levy, a spokeswoman with California’s Employment Development Department.

People who lose their jobs may qualify for federal unemployment insurance after their state benefits run out. State benefits generally last up to 26 weeks.

“This money is very important sustenance to help them put food on the table, gas in the car,” Levy said. “It’s very important critical money to help these people get by so they can find that next job.”

Jacqueline Alcala may qualify for federal benefits in six weeks when her California benefits end. If that happens, the $330 a week she receives now will be reduced.

“My husband is going to be the one really trying to pull the family together with his check and the little check I’m going to get,” Alcala said. “So, it’s going to make an impact. I don’t know how much to say now because I’m not there yet, but once I see the money, it’s probably going to be like, ‘Whoa!’”

The Montebello resident lost her job in November after Hostess Brands - the makers of Twinkies - filed for bankruptcy and later sold its business to new owners. Her family no longer eats out and she says eating at McDonald’s would be a luxury. She’s trying to find work. But after applying to 10 jobs, Alcala has struck out.

The state’s Employment Development Department has also been hurt by sequestration and lack of federal funding.

“We have already lost the ability to fill 900 unemployment insurance positions and we’re down that many already and the demand, however, has not declined that much at all,” Levy said.

At a time when people out of work need help, the state agency that provides free assistance faces cutbacks.

The department said it could lose more than $30 million in funding for its unemployment insurance program. There will also be an additional cuts to its One-Stop Career Centers, which helps workers find jobs, as well as its Workforce Investment Boards, which assists the unemployed with job training.

Levy said the department is in the process of analyzing how those cuts will be implemented.

“Most likely that means there aren’t going to be the resources and representatives available to help people,” Levy said.

Patsy Cantu counts on help from the Verdugo Jobs Center in Glendale, which is operated by the Employment Development Department. She sat at the center’s computer, sending out resumes and checking up on leads.
“They’ve saved me. Literally saved me," said Cantu. "They will have me a job for one or two days, or something. They just give you the will to go on, otherwise you wouldn’t even want to search for work. Without them, we’re lost.”

Cantu lives in Downtown L.A. and takes a bus to Dodger Stadium on her way to the Glendale job center. But she doesn’t want to spend more money for a longer bus ride – so she walks the last six miles to get there. Cantu said she’s saving her bus money to get to job interviews.