Nearly 3,000 in the Chattanooga area will lose unemployment benefits in January unless Congress acts

Nearly 3,000 in the Chattanooga area will lose unemployment benefits in January unless Congress acts

November 18th, 2012 by Joan Garrett McClane in Business Around the Region

Job seekers fill out applications at a construction job fair.

Photo by Associated Press/Times Free Press.

Unemployment by the numbers

8.7 percent in Georgia

8.2 percent in Tennessee

7.9 percent nationwide

Long-term jobless:

39,000 in Tennessee

79,759 in Georgia

Every week, Stephanie Davis fills out papers to prove she is looking for work.

She bought a car with the little money she and her husband could save between his paycheck and her $275 a week unemployment check so she could drive to interviews.

But in eight months of searching -- since she was let go from her position at a retailer in the Eastgate Town Center because of her medical related absences from work -- she hasn't found any takers.

Last week, after she had surgery to remove four teeth, she was notified that the government help would be running out very soon, she said.

"I have no idea what I am going to do at this point," said Davis, who lives in Birchwood with her husband and two young children. "Shampoo and garbage bags, it's a struggle these days. I don't know how much harder I can work at it."

Some 39,000 jobless Tennesseans, including nearly 3,000 in metropolitan Chattanooga, will lose their unemployment benefits in January. In Georgia, another 79,759 long-term unemployed people will lose benefits at the end of the year unless Congress extends the emergency federal program.

Tennessee Labor Commissioner Karla Davis doesn't expect that to happen and is warning those who have been unemployed for more than six months to prepare to lose weekly benefits of up to $275 in the first week of the new year.

More than 5 million Americans have been unemployed for more than six months and are still trying to find work, according to the Bureau of Labor Statistics. And many, including Georgia Labor Commissioner Mark Butler, have suggested that pulling the plug on unemployment benefits could give some the nudge they need to get back in the market.

Rules in Tennessee were put into place to keep recipients from getting complacent. Since September, those such as Stephanie Davis have been required to prove their efforts to look for work by keeping a log and complying with individual audits.

The same checkups exist in Georgia.

Jeffrey Humphreys, director of economic forecasting at the University of Georgia, said he doesn't think discontinuing benefits will hurt economic growth overall.

"I believe we need to embrace a little bit of austerity," he said. "I don't want us to completely ignore our annual deficit. So I favor not extending unemployment benefits. That is one part of the 'fiscal cliff' that should go forward."

Still, others worry cutting assistance will cause additional harm to those hurt most by the economic recession.

While overall unemployment numbers have declined in the last few years -- the rate last October was 8.1 percent and the rate this October was 7.3 percent -- there are three to four applicants for every job in Tennessee, said David Penn, an economist at the Middle Tennessee State University Business and Economic Research Center.

Many of the jobless are without a college degree and unable to move, either because of family responsibilities or finances, he said.

And without a certain decision on the "fiscal cliff," businesses aren't going to be expanding or opening more positions any time soon.

"This is the largest percentage of long-term unemployed since the Depression," Penn said.