Extension to aid state’s unemployed

Posted Nov. 24, 2008, at 9:48 p.m.

AUGUSTA, Maine — About 3,500 Mainers who have exhausted their extended unemployment benefits can immediately apply for the extension of federal unemployment benefits approved last week by Congress. But that help may run out early in January.

“We also have about 2,000 people that are currently receiving extended benefits,” Labor Commissioner Laura Fortman said Monday in an interview. “And there are between 150 and 200 that are exhausting their regular benefits every week that can now apply for the extended benefits that Congress passed last week.”

The measure, signed into law by President Bush within hours of it passing, will provide an additional seven weeks of extended benefits. The 13-week extension passed by Congress earlier in the year ran out in October.

The new legislation also will automatically provide an additional six weeks of extended benefits in those states that have unemployment rates of 6.5 percent or greater.

Fortman doubts Maine will reach that level.

“Congress will undoubtedly need to do more and extend unemployment beyond seven weeks to assist our fellow Americans during these challenging economic times,” said Sen. Olympia Snowe, R-Maine., after the measure passed Congress. “I have advocated for an extension of this critical resource that now, with more than 4 million Americans out of work and national unemployment at a 14-year high, is needed more than ever.”

Fortman had hoped for a longer extension of the federally funded benefits, given the expected increases in the number of Mainers who will exhaust their state, or regular, benefits.

“It was about six months ago that we saw Maine’s rate start to edge upward,” she said. “The number exhausting benefits every week is going to continue to grow.”

Maine AFL-CIO President Ed Gorham said Monday that Congress should have passed a 13-week extension, or longer, for every state. He said it is disgraceful that Congress has approved billions to help Wall Street companies but could fund additional unemployment benefits for only seven weeks.

“I continue to be amazed that the people that are really hurting in this economy and this collapse can be treated like that while we give untold hundreds of billions of dollars to the financial services industry,” he said. “I can just hope they get an earful when they get home for their Christmas recess.”

Gorham said Maine’s entire congressional delegation supported a 13-week extension and he hopes other lawmakers take the bipartisan lead of the state delegation in January. He said it is clear the recession is continuing and unemployment is a safety net that helps keep families financially afloat.

“This money directly goes right into the economy,” he said. “It pays for food and helps pay the bills. People are not using it to take trips to Cancun.”

Fortman agreed and said all the economists she has heard or read stress unemployment benefits as key to helping stabilize the economy and help it recover.

“This is important for families, but it also is important for the economy,” she said.

Fortman is urging Mainers to file their applications or renewal information online because of the increased numbers receiving unemployment. The Web site is www.file4ui.com.

In October, Maine’s unemployment rate rose from 5.6 percent to 5.7 percent. That represents more than 44,000 Mainers who were out of work and looking for work. That is more than the total population of Waldo County.

The official unemployment rate ranges from 4.1 percent in Cumberland County to 9.1 percent in Piscataquis County.

For the latest week that data are available, more than 7,000 workers received regular unemployment insurance benefits averaging about $269 a week, and about 2,000 workers received federal extended benefits averaging about $252 a week. In addition, recipients get an extra $10 a week for each dependent.

That totals about $2.4 million a week in benefits that economists believe go directly into the economy to pay for necessities, such as food.

Maine’s unemployment fund, unlike those of many states, is in good shape to handle the increased demand of more unemployed.

The state fund has 18 months of reserves. That’s about $460 million and is funded by a tax on employers. By the end of 2008, Maine employers will have paid an estimated $89.5 million into the fund. Unlike some states, Maine’s unemployment fund is paid for entirely by employers.

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