Legislation on unemployment benefits could hit New Jersey hard

New Jersey's unemployed would be particularly hurt by federal legislation that could come up for a vote in the House of Representatives as early as Tuesday.

New Jersey would be hurt more than Pennsylvania or Delaware because unemployment is higher there and because it has stayed higher longer.

If that seems counterintuitive - that the state in the region with the worst unemployment would stand to lose the most benefits - it's because six weeks of benefits for high-unemployment states such as New Jersey, with its 9.1 percent unemployment rate, would be phased out starting Jan. 1.

Pennsylvania, at 8.1 percent, and Delaware, at 7.9 percent, have been doing better and have not qualified for those six weeks.

If the GOP-sponsored legislation becomes law, the jobless in all three states would receive 59 weeks of benefits, down from 99 weeks in New Jersey and 93 weeks in Pennsylvania and Delaware.

The proposed change is part of the politically charged bundle of legislation in Washington that includes continuing the payroll-tax break, payments for doctors, and changes in environmental regulations.

With that kind of amalgamation, everything is in play.

With 13.3 million unemployed, most agree that some federally funded benefits should continue. The dispute is over how benefits should be funded and for how long.

Those who favor the current structure say benefits help the families of the unemployed and stimulate the economy, since the cash-strapped jobless spend every dime they get.

Besides the cost, those who want to shorten benefits say long benefits discourage workers from more quickly making hard, but necessary, decisions such as switching careers or moving to regions with available jobs.

States pay for the first round of benefits, usually 26 weeks.

During the recession and its aftermath, Congress passed legislation funding an additional 73 weeks, broken up into several segments. The legislation, proposed by House Republicans, would remove three segments, for a total of 40 weeks, leaving 26 weeks of state benefits and 33 weeks of federal benefits, or 59 weeks in total.

Two segments, for a total of 20 weeks, would be removed outright. These segments include the six weeks now available in high-unemployment states such as New Jersey.

States would phase out of the other 20 weeks of benefits in the spring, with the precise timing depending on calculations involving their employment situations.

This calculation particularly hurts states such as New Jersey, where the unemployment rate has fallen slightly but remains stalled in a tough spot. New Jersey's unemployment rate has been at or above 9 percent since May 2009 but is down from its 9.8 percent peak in January 2010. At the start of the recession, New Jersey's unemployment rate was 4.5 percent.