Unemployment and wearing a coat at home

By Thomas E. Perez

Sunday, Jan. 26, 2014 | 2:03 a.m.

This winter, Katherine Hackett is wearing a hat and coat around her house. In order to save on heating costs, she keeps her thermostat set at 58 degrees. After 17 years in the health care industry, after raising two sons who are now in the military, the Connecticut resident abruptly got a pink slip and has been unemployed for more than a year.

But so far, Congress has shown little interest in throwing her a lifeline. By failing to extend the Emergency Unemployment Compensation program, Congress has cut off the jobless benefits that help Katherine and millions like her keep the lights on and the rent or mortgage paid. In Nevada this year, 60,300 unemployed people will feel the impact of a failure to extend EUC.

Nearly 69 million people have received a hand-up from extended unemployment benefits since 2008. Last year alone, the program lifted an estimated 2.5 million people out of poverty. Plus, these benefits act as a broader economic stimulus. They keep money in the pockets of working families, money that gets spent at local businesses, thus promoting growth and job creation.

Failure to renew the program would mean an estimated 240,000 American jobs lost, 2,953 of them in Nevada.

Extended unemployment insurance during times of economic distress has been a common-sense bipartisan tradition for decades. The current program was launched under President George W. Bush in 2008, at a time when the unemployment rate and the average duration of unemployment were much lower than they are today.

Long-term unemployment remains unacceptably high even as the overall economy has continued to recover. To pull the plug on extended benefits now would be historically unprecedented — we have never done so when long-term unemployment was even half as high as it is right now.

The fact is: the longer you’re out of a job, the harder it is to find one. As President Barack Obama put it, there’s a terrible Catch-22: “Companies won’t give their résumé an honest look because they’ve been laid off so long, but they’ve been laid off so long because companies won’t give their résumé an honest look.”

The stories I hear in my visits with long-term unemployed workers are heartbreaking. Staring at possible home foreclosure and the depletion of their 401(k) plans, they see the American dream slipping away. One man told me he had cancer seven years ago, and this unemployment struggle is worse.

Some have suggested that the unemployed are lazy and these benefits make them more so. But this is as offensive as it is flat-out wrong. For one thing, an aggressive job search is a precondition for the receipt of unemployment benefits.

Besides, it just defies common sense. No one is living the good life on unemployment insurance. On average, it replaces only about half of a worker’s earnings — who’s going to be satisfied with a 50 percent pay cut? Why would Katherine Hackett rather wear a coat in the house than enjoy the dignity of work? Katherine and the other workers I’ve met are diligently applying for every position for which they might be qualified.

EUC is a stopgap. As the president recently explained, these benefits are not “hammocks for people to just lie back and relax.” Rather, they are a springboard back to gainful employment and economic security. EUC is a lifesaver, not a lifestyle.

Benefits expired for 1.3 million Americans on Dec. 28. But unconscionably and irresponsibly, Congress continues to sit on its hands, adjourning for recess without leading on this issue. A minority of U.S. Senators continues to block any extension, while the majority leadership of the House of Representatives won’t even bring it up for a vote.

The president has said that extending EUC should be the nation’s first order of business for 2014. To ease hardship and provide some relief in Nevada and nationwide, Congress must act immediately.

Thomas E. Perez is the U.S. secretary of labor.