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Unemployment Compensation Extension Act

On September 22nd, the House passed the Unemployment Compensation Extension Act (H.R. 3548) to provide up to 13 additional weeks of unemployment benefits to workers in high unemployment states who are about to run out of benefits. While we continue working to turn the economy around, the New Direction Congress is committed to providing much-needed relief to the millions of unemployed American workers, as they struggle to find work.

This extension will help at least 300,000 in 27 states and DC and Puerto Rico who will exhaust all of their unemployment benefits by the end of September and over 1 million people in these states who will run out of unemployment by the end of December.  This extension is targeted to those states with particularly high unemployment (with a three-month average total unemployment rate (TUR) of 8.5 percent, or a 13-week insured unemployment rate (IUR) above 6 percent), where it is more difficult for people to find new jobs.  This extension will ensure that those workers will be able to continue providing for their families - helping to pay for groceries, filling their cars with gas and making their mortgage payments on time.

Extending these benefits is one of the most cost-effective and fast-acting ways to stimulate the economy because the money is spent quickly.  Every $1 spent on unemployment benefits generates $1.63 in new economic demand. The bill would not add to the deficit:  it extends the federal unemployment tax for one year that has been in place for more than 30 years, and requires better reporting on newly hired employees (start date) to reduce unemployment insurance overpayments - both of which were proposed by President Bush. 

This will build on the progress of the American Recovery and Reinvestment Act, which has:

  • Given a tax cut to 95% of working Americans in every paycheck
  • Saved the jobs of police officers, nurses and 135,000 teachers and other school workers
  • Provided a first-Time Homebuyers Tax Credit to at least 334,000 new homeowners
  • Boosted estimated auto sales by 26% to the highest level they've been all year through Cash for Clunkers
  • Supported nearly $10 billion in small business loans to operate and expand
  • Added between 600,000 to 1 million American jobs as of the 3rd quarter, according to independent estimates -- helping to bring job losses to lowest level in a year in August  
  • Added 2-3 percentage points to GDP growth in the 2nd quarter of 2009 and around 3 percentage points in the 3rd quarter - critical to moving us to positive economic growth this fall