Millions of out-of-work Americans learned Thursday that their weekly unemployment checks will continue now that President Obama has signed the $34 billion extension to jobless aid.
The law will restore benefits retroactively for about 2.5 million people who have been cut off since the June 2 expiration of federal emergency aid. Millions more who would have lost eligibility in coming months will be protected through November, when the latest extension ends. The law will not, however, help people who have already exceeded the 99-week maximum.
The extension is good news for many of the nation’s 14.6 million unemployed—though it will be several weeks before the restored payments hit mailboxes and bank accounts.
The explanation of who’s eligible and who’s not—and for how many weeks—often is murky, because benefits available to individuals are based on a series of calculations that take into account state-specific unemployment rates and other factors. Not everyone gets the 99-week maximum.
Here are five questions and answers about a very complicated system.
Q. Who gets unemployment?
A. If you were laid off or are otherwise out of work through no fault of your own, you can apply for regular benefits, which are funded at the state level by premiums that employers pay. The length of time you can collect these payments depends on how long you worked and what you were paid, with a maximum of 26 weeks.
Q. How long can someone collect benefits? What’s the maximum amount?
A. If you pass the 26-week state maximum, you may be able to transfer into Tier I of federally funded Emergency Unemployment Compensation. There are four tiers of EUC, offering a maximum of 53 additional weeks; the specific number of weeks you’ll get depends on your state’s unemployment rate.
If your state deemed you eligible for fewer than 26 weeks of state benefits, that will also affect the number of weeks you may collect federal extensions. The variety and disparity of individual circumstances and eligibility is one reason the unemployment insurance process can be so confusing.
But, assuming you qualify for the full state and federal duration—a total of 79 weeks—one last pool of money, known as Extended Benefits (EB), may remain open to you, for a maximum of 20 more weeks. Grand total: 99 weeks.
Weekly benefit amounts vary by state and range from less than $300 to nearly $600, depending on your location and the wage you earned while employed. The nationwide average for benefits is just under $300.
For more details about the various benefit tiers, see Flow of Unemployment Insurance Benefits chart compiled by the House Ways and Means Committee. The Department of Labor has placed on the Web an interactive map that will lead you to your state’s unemployment commission.
Q. Who will be affected by the extension?
A. In June, authorization for the federal unemployment programs expired, cutting off people who were about to roll from regular state benefits to EUC, and stopping others from progressing through the tiers of EUC and to EB. The extension will reinstate those benefits for people who haven’t maxed at 99 weeks.
Q. Who won’t be helped by a federal extension?
A. No one may collect more than 99 weeks of unemployment benefits. So people who have exhausted their state and federal eligibility—even if it was for less than 99 weeks, based on the state unemployment-rate formula—won’t be reinstated. Nor will there be help for people who didn’t qualify for state-level regular benefits.
Advocates for unemployed workers are lobbying for a Tier V benefit that would extend past 99 weeks, but that would take new legislation. No such bill is pending, according to the Department of Labor.
Q. What’s next for people who have maxed out?
A. A growing number of them are expected to seek public programs for food assistance, cash aid and other services. Many people will become eligible for more social services as their unemployment checks vanish. Others are tapping family or retirement accounts to stay afloat.
David Irwin, 56, held senior executive posts in the Silicon Valley computer industry, eventually moving to New Mexico as vice president of engineering with a web design firm. In October 2008, he was laid off and recently became a “99-weeker,” with no more unemployment checks on the horizon.
“The reality is, I’m living off my savings,” said Irwin, who cofounded the NoJobSurvivor online community and does private website consulting. He’s discouraged after nearly two years of competing “with thirtysomething MBAs” for scarce openings in his field.
“I’ll never be able to retire now,” said Irwin, who’s taken in a lodger to help with expenses. “And yet I’m probably a lot more fortunate than most—at least I have what’s left of my 401(k). A lot of people out there don’t have that and are staring at the box under the overpass.”
The rolls of long-term unemployed include many older workers. A recent report by the AARP Public Policy Institute, reflecting calculations based on Department of Labor statistics, showed that nearly 2.1 million people age 55 and over were unemployed in June. The average period of unemployment for those 55 and over was approximately 10 months—40.6 weeks. That is nearly three months longer, on average, than for younger workers.
The extension means people who haven’t exceeded the 99 weeks can look forward to continuing help. “States are poised to try to get benefits out as quickly as possible,” said Marc Katz, director of public affairs for the National Association of State Workforce Agencies. “It’ll be the number one priority, but it’s a very complicated process.”
Melissa Preddy is a Michigan-based freelance writer specializing in personal finance and consumer affairs. She formerly worked for the Detroit News.