Recipients of unemployment benefits rising fast

ByBarbara Hagenbaugh, USA TODAY
November 14, 2008, 11:48 AM

WASHINGTON -- Americans losing jobs are having a tough time finding work and are collecting unemployment benefits at numbers not seen in a quarter of a century.

Nearly 3.9 million people were collecting jobless benefits in the week ended Nov. 1, the period of most recent data. That was up 65,000 from the week before and the highest since January 1983, when the USA was recovering from one of the deepest recessions in the postwar era, the Labor Department said Thursday. It's a 50% jump from a year ago when 2.6 million people were collecting jobless benefits.

People appear to be losing jobs at an increasingly rapid pace. The number of workers applying for benefits last week for the first time was the highest since a few weeks after the Sept. 11 terrorist attacks.

"Hiring has slowed to a crawl, keeping unemployed workers on benefit rolls for long periods," Moody's economist Andrew Gledhill said in a note to clients. "Until (business) confidence firms, hiring will remain tepid."

Kathleen Curtin's unemployment benefits ran out last week. Curtin, 57, who has a master's degree in education and was laid off from a tutoring company in April, has nearly depleted her savings. She and her husband, who is also unemployed, are living on his Social Security benefits.

The job market is "horrible, just terrible," says Curtin of Casselberry, Fla. "There is hardly anything out there."

Employers shed 240,000 jobs in October after cutting 284,000 in September.

Calling the latest numbers "pretty ugly," economic consulting firm Action Economics predicts 300,000 people will be laid off this month. That will lift the unemployment rate to 6.7% in November from 6.5% in October, which was the highest in more than 14 years.

Congress next week may take up legislation to extend unemployment benefits for a second time this year. Rep. George Miller, D-Calif., who heads the House Committee on Education and Labor, says nearly 1 million people collecting unemployment checks now will run out of benefits by the beginning of the year.

Losing benefits not only hurts those who are unemployed, but it has a ripple effect throughout the economy when those people spend less money, he says.

"There is growing sentiment on both sides of the aisle that we have to do this before we leave," Miller says.

Workers are eligible for a maximum of 26 weeks of state unemployment benefits plus 13 weeks of extended federal aid. In October, the House overwhelmingly passed a measure that would extend benefits for seven weeks in all states and 13 weeks in states with high unemployment. The Senate didn't take it up.

ABC News Live

ABC News Live

24/7 coverage of breaking news and live events