States' jobless funds are being drained in recession

[StarfarerBill]

Source: Washington Post

The recession's jobless toll is draining unemployment-compensation funds so fast that according to federal projections, 40 state programs will go broke within two years and need $90 billion in loans to keep issuing the benefit checks.

The shortfalls are putting pressure on governments to either raise taxes or shrink the aid payments.

Debates over the state benefit programs have erupted in South Carolina, Nevada, Kansas, Vermont and Indiana. And the budget gaps are expected to spread and become more acute in the coming year, compelling legislators in many states to reconsider their operations.

Currently, 25 states have run out of unemployment money and have borrowed $24 billion from the federal government to cover the gaps. By 2011, according to Department of Labor estimates, 40 state funds will have been emptied by the jobless tsunami.

Read more: http://www.washingtonpost.com/wp-dyn/content/article/2009/12/21/AR2009122103269.html?hpid=topnews

[mbperrin]

1. This can't be true - Ben Bernanke said that the recession is over!

Roses and sunshine!

And free health care for everyone, well except for those that already have it, those that don't have it, those that can't afford it, those that could afford it but not with this legislation, uh, anyway, things are just great! Choco ration is up, too!

[endless october]

2. the good paying manufacturing jobs have been destroyed.

maybe we should think about some trickle UP economics for a change.

[RedEarth]

3. Detroit has an unemployment rate of nearly 50%.... Michigan nearly 21%

...both figures represent the broadest measure of unemployment...part-time that want full time, underemployed, long-term unemployed, those in school that would rather being working...


Nearly half of Detroit's workers are unemployed
Analysis shows reported jobless rate understates extent of problem
Mike Wilkinson / The Detroit News
Despite an official unemployment rate of 27 percent, the real jobs problem in Detroit may be affecting half of the working-age population, thousands of whom either can't find a job or are working fewer hours than they want.

Using a broader definition of unemployment, as much as 45 percent of the labor force has been affected by the downturn.

"It's a big number, and we should be concerned about it whether it's one in two or something less than that," said George Fulton, a University of Michigan economist who helps craft economic forecasts for the state.

Mayor Dave Bing recently raised eyebrows when he said what many already suspected: that the city's official unemployment rate was as believable as Santa Claus. In Washington for a jobs forum earlier this month, he estimated it was "closer to 50 percent."

Although the government doesn't produce an unemployment number that high, it's not hard to get close.

Officially, the unemployment rate in Detroit was estimated at 27 percent in October. But that number does not include people working part-time who want full-time work, nor does it include "discouraged" workers, who have stopped looking for work. It also doesn't include people who have gone back to school rather than search for a job.

The Bureau of Labor Statistics estimated that for the year that ended in September, Michigan's official unemployment rate was 12.6 percent. Using the broadest definition of unemployment, the state unemployment rate was 20.9 percent, or 66 percent higher than the official rate. Since Detroit's official rate for October was 27 percent, that broader rate pushes the city's rate to as high as 44.8 percent.

http://www.detnews.com/article/20091216/METRO01/912160374/1409/METRO/Nearly-half-of-Detroit-s-workers-are-unemployed