WASHINGTON AND LOS ANGELES — 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 worsen heading into next year.
The extension, covering an additional 13 weeks, would maintain payments for more than 1 million workers in 29 hard-hit states whose benefits are set to expire before the end of 2009. Unemployment payments for more than 300,000 U.S. workers will end this month alone.
The measure would extend immediate help to the 66,000 unemployed Californians whose benefits are expected to run out by the end of September and the 170,000 who will exhaust benefits by the end of the year, said Loree Levy, a spokeswoman for the California Employment Development Department. In all, more than half a million unemployed Californians could benefit from the extension.
Along with previous extensions, the measure would boost the normal 26 weeks of jobless benefits in California to a maximum of 92 weeks. About 1.5 million Californians currently are receiving unemployment checks, Levy said.
The Senate is expected to approve the extension quickly, and it 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%, projected to climb to double digits well into 2010, researchers say that as many as 2.5 million jobless workers will exhaust benefits by next summer, sharply increasing the cost of further extensions.
In California, whose unemployment rate hit 12.2% in August, officials are projecting that the unemployment insurance fund will be more than $17 billion in the red by the end of 2010. It's one of 21 states whose unemployment insurance funds are insolvent.
"States throughout the country are finding they did not collect enough money to cover a recession this long and this deep," said Philip J. Romero, dean of the College of Business and Economics at Cal State L.A.
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 and allocating existing federal funds to create temporary jobs.
