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Unemployment Benefits To End For Nearly 100,000 Californians

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(CBS)

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MERCED (CBS / AP) — With her anti-poverty budget stretched beyond its limits, Brenda Callahan-Johnson is braced for next Saturday: the day California’s chronically unemployed will be cut off from the nation’s jobless benefits.

A drop in the state’s unemployment rate to 11 percent – its lowest mark in three years – is triggering the federal cutoff of emergency, long-term unemployment pay to at least 93,000 Californians.

But in the state’s agricultural heartland, where Callahan-Johnson runs the Merced County Community Action Agency, a jobless rate of more than 20 percent – two and a half times the nationwide average of 8.2 percent – makes it difficult for some to believe an economic recovery has begun.

“I think Merced County is used to hardships, but we are stretched beyond our capacity here,” Callahan-Johnson said of the rural county that sits roughly midway between Fresno and Sacramento. “In Merced County there are no jobs to be had.”

The cut-off is another blow to a region with the state’s highest percentage of people living below the poverty line, and where the bursting of the housing bubble has led to the highest foreclosure rate in the country.

The Golden State has lost its luster for many of the chronically unemployed, and even for those whose job it is to provide anti-poverty services to them. With just two weeks’ notice, those 93,000 people will join 670,000 other unemployed Californians whose benefits, averaging $292 a week, already have run out.

KCBS’ Tim Ryan Reports:

“This is a hard cut-off. It’s not like you get to finish out your 20 weeks,” said Maurice Emsellem, policy co-director of the National Employment Law Project. “This is a very dramatic impact with this latest wave of workers … who once were gainfully employed who have run out of everything.”

Tina Dumaguing is among them. Her unemployment benefits expired in April, 99 weeks after she lost the job she had held for 11 years as a duplicating technician with the Turlock Unified School District. With two foreclosure notices on her home in the town of Delhi, shut-off notices from the water and power companies, nothing left in savings and an unreliable ’98 Saturn limiting her mobility, she is finding herself in a position she never imagined.

On Thursday, at age 50, she applied for food stamps for the first time.

“Before I thought if I had to do this, I’d be embarrassed,” said Dumaguing. “But knowing how hard I’ve been trying to find a job, well, it’s just frustrating, but I’m glad it’s here.”

The federal government took extraordinary steps in 2009 to prop up workers who lost their jobs during the recession. The normal 26 weeks of state benefits were supplemented by three types of federal extensions that added up to 73 more weeks for a total of 99 weeks of benefits, the longest on record.

Under federal law, the rate of unemployment must be 10 percent higher than for the previous three years for the extended benefits to remain in each state. California’s rate has been declining.

The state is just one of eight where the chronically unemployed will lose support May 12. The others are Colorado, Connecticut, Florida, Illinois, North Carolina, Pennsylvania and Texas, where another 140,000 people will be affected. Fifteen other states were cut in April, including Michigan, Ohio, Indiana, Georgia and South Carolina.

Since March 2009 when the program began, more than 912,000 unemployed Californians have received $5 billion in payments.

“Imagine our economy without that additional $5 billion,” said Loree Levy, spokesman for the California Employment Development Department. “It gives the individuals spending power in local communities.”

That money ripples through the economy, into supermarkets, gasoline stations, utilities, and services. That allows those businesses to hire more people, who, in turn, spend more money. The Congressional Budget Office says every $1 spent on unemployment benefits generates up to $1.90 in economic growth.

The cutoff also affects another 200,000 people who would have become eligible for the long-term program this year, said Levy.

Half of the people collecting unemployment in California have been unable to find jobs for more than six months, Levy said.

The agriculture industry is the largest employer in Merced County. The second largest employers in the county of 250,000 are the county and municipal governments. Last year more than 52,000 people sought heating assistance or help navigating the social services application process from the local Community Action Agency, which is stretched so thin they have to turn people away.

“People here are not working for lack of wanting to work,” Callahan-Johnson said. “It’s a lot of work to be poor, a lot of work just to survive every day.”

Connie Schlessinger, 36, exhausted her benefits last July after being laid off from her jobs at Jack-in-the-Box and as a telemarketer. Her husband performs odd jobs at their apartment complex to get a discount on rent, and food stamps feed the couple and her mother, whose Social Security helps pay bills.

“I used to work two jobs and now I can’t find one,” she said.

Dumaguing also has been striking out. She has spent months applying for work at other school districts, at government agencies and at restaurants. With the help of her son, she uses the computer at the county library to fill out applications online.

“I’ve been applying anywhere I could. There are just no jobs out there,” she said.

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