WASHINGTON – The House voted overwhelmingly Tuesday night to approve a $1.4 billion stopgap extension of jobless benefits, but some states are beginning to seek longer-term solutions to an unemployment problem that is expected to remain serious for the rest of the year and may grow worse next year.
The extension, covering an additional 13 weeks, will maintain payments for more than 1 million workers in 29 hard-hit states – including Washington and Idaho – whose benefits are set to expire before the end of the year. Unemployment payments for more than 300,000 people will end this month alone.
The extension would apply to about 75 percent of all unemployed workers in the United States.
The measure, which the Senate is expected to approve shortly, would take effect as soon as it is signed into law. It would be paid for by deferring a scheduled reduction in unemployment insurance tax paid by employers.
But with the nation’s jobless rate, currently at 9.7 percent, projected to climb to double digits well into next year, researchers say that as many as 2.5 million jobless workers will exhaust benefits by next summer – sharply increasing the cost of further extensions.
Responding to the longer-term challenge, New Jersey last week announced it would pay businesses up to $2,400 for every idle worker they hire whose government unemployment benefits have expired.
Officials in other states, along with experts in unemployment insurance policy, are looking at such options as using tax credits for job creation, as well as allocating existing federal funds to create temporary jobs, although people monitoring those talks say they are preliminary and mostly among researchers and policy analysts.
“I think we need to be creative, so everything should be on the table,” said Andrew Stettner, deputy director of the National Employment Law Project, a research and advocacy group.
The official number of unemployed in the U.S. has doubled to 15 million, and a record one-third of those workers have been jobless for six months or longer.
Soon “you’re going to be rolling into Christmas season … (the extension) will have a huge impact,” said Rep. Jim McDermott, D-Wash., who introduced the legislation approved Tuesday in an expedited vote by 331 to 83.