Budget cuts hit unemployed in Chattanooga area

Budget cuts hit unemployed in Chattanooga area

March 16th, 2013 by Dave Flessner in Business Around the Region

When Gary Traylor lost his job with the closing of Shaw Industries' Trenton, Ga., plant two years ago, the displaced worker got Georgia jobless benefits of $350 a week until he landed a job at Scenic Industries.

After losing that job in October and being unemployed again, his Tennessee unemployment insurance payments now give him $255 a week. By June if Traylor doesn't find new work, the 59-year-old Chattanoogan could lose another $27 a week because of cutbacks in jobless benefits from the congressionally ordered budget sequestration for federal jobless benefits.

"It's getting harder and harder just to get by, and at my age, employers seem less willing to hire me even though I never missed a day of work," he said this week while searching for work at the Tennessee Career Center with his unemployed wife, Gail.

The Traylors are among more than 90,000 unemployed Tennesseans and Georgians facing benefit cuts this spring because of cutbacks in the federal budget for federally paid jobless benefits for those unemployed for more than six months.

Congress provided such extended benefits for unemployed people at the start of the Great Recession in 2008 to help cushion the fall for many workers whose jobs were lost during the economic downturn.

The budget agreement to cut federal spending provides for a 10.7 percent cut in federal jobless benefits, starting in April.

In Tennessee, the benefit cuts will affect 30,000 claimants, according to the Tennessee Department of Labor and Workforce Development. The Georgia Department of Labor estimates 61,360 recipients of extended unemployment benefits in the Peach State will be hit by the cuts.

Regular state-funded unemployment insurance provided to jobless people during the first 26 weeks of unemployment will not be affected, however.

Proponents claim the cutbacks, which total $2.3 billion this year from the federal extended unemployment insurance program, are needed to help reduce federal deficit spending. Most jobless people are not unemployed for more than six months and won't be affected.

But Claire McKenna, a policy analyst for the National Employment Law Project, said the prolonged recession and ongoing technology changes have left many workers displaced from their former occupations and unable to find other work.

"We think it would be unwise to deprive workers of these unemployment benefits, which we know are spent to help lift a still weak economic recovery," she said. "These dollars also do a lot to help people cope and avoid other problems while they look for other work or get training for a new type of work.