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Emergency unemployment insurance continues

Published: Friday, Jan. 4, 2013 3:32 p.m. CDT • Updated: Friday, Jan. 4, 2013 3:34 p.m. CDT

CHICAGO — The Federal Emergency Unemployment Compensation insurance program will continue through December 2013, the Illinois Department of Employment Security (IDES) said Jan. 2.

Congress, this week, extended the Emergency Unemployment Compensation (EUC) program as part of the ongoing fiscal cliff negotiations. As such, Illinois workers collecting EUC should continue to certify for benefits. Congress did not add new weeks to the federal unemployment insurance program. Therefore, individuals who exhausted EUC are not eligible for additional unemployment insurance benefits.

Extending the EUC program will support a gradually improving economy. Every $1 in unemployment insurance generates $1.63 in economic activity because the dollars are quickly spent at neighborhood businesses.

Had Congress not re-authorized the program, 90,000 Illinois claimants would have received their last EUC payment within the next two weeks. Additionally, 2,800 individuals each week would have completed the state’s Regular Unemployment Insurance program and not had access to the federal EUC.

Extending EUC will not alleviate IDES’ budget pressures. The Illinois department receives operational funding entirely from the federal government. Funding levels are tied to the number of people collecting unemployment insurance. Fewer people collecting state unemployment insurance means an $11 million annual cut. These cuts come at a time when the numbers of claims remain 38 percent higher than prior to the recession. The fiscal cliff negotiations, also called the sequester, did not resolve cuts to budgets such as IDES’. Rather, Congress delayed by two months the date the sequester takes effect. Therefore, IDES still stands to lose an additional $17 million in operating funds.

To begin to address these budget challenges, IDES already has stopped scheduling 216 intermittent employees, consolidated eight offices and vacated 10 outpost locations shared with partners. The federal cuts might necessitate further service reductions, including additional office consolidations.

Illinois businesses provide the state’s 25-week regular unemployment program for claims initiated in 2012. The federal EUC, divided into Tiers I, II, III and IV, provide the next 53 weeks of unemployment insurance. The federally funded Extended Benefits (EB) program provided the final 20 weeks. It expired in May 2012.

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