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News - Local

Saturday, Dec. 08, 2012

For many jobless, pressure's on

400,000 Californians could lose their extended benefits

- mrowland@modbee.comand MIKE NORTH
mnorth@mercedsunstar.com

State and federal unemployment benefits are identical, anywhere from $40 to $450 a week, depending on a worker's recent quarterly wages.

Between state and federal extension benefits, the EDD has paid $17.1 billion in benefits to Californians in 2011 and $9.3 billion up to August of this year. The EDD reports that it pays about $284 million a week.

But since the recession began, close to 900,000 Californians have run out of all available benefits, both state and federal.

Last month, the nonpartisan Congressional Budget Office released a report that said extending the current federal benefits through next year would add the equivalent of 300,000 jobs by boosting spending and growth in 2013.

The CBO report said the current extended federal benefits would cost about $30 billion and increase gross domestic product by 0.2 percent by the fourth quarter of 2013. The increase in demand for goods and services created by the unemployed having money to spend would account for about 300,000 full-time jobs.

Gabriel Orozco, a 36-year-old Merced resident, said unemployment benefits are just enough to keep people afloat, but they go a long way toward helping people improve their livelihoods.

Orozco lost his job about a year and a half ago before starting up a day care, which also went under. For a while, he was relying on unemployment benefits. Now, he's draining his 401(k).

"Unemployment is really just the bare minimum getting you by," he said. "It would be good just to have it until you can find something permanent or steady or long term."

Through his job searches, Orozco's had a hard time finding full-time, permanent positions.

"It's hard to find any permanent positions right now," Orozco said. "If you look on most of the sites, they're either substitute positions, interim positions or part-time positions."

Because of the slow job market, Orozco's done what he can to conserve his money.

"I've cut back on a lot of expenses -- eating out, going out to the movies and stuff like that," Orozco said. "A lot of little things that I probably would've done on top of regular day activities, I've cut them out just to save on gas and to save my money to pay whatever bills I do have, such as rent and lights and all that."

Considering the poor local economy, Orozco thinks the benefits should be extended to allow unemployed people more time to get back on their feet.

"I have two degrees -- one in psychology and one in sociology, both an AA and an AS, but I haven't been able to find any jobs," said Orozco, who puts in 15 applications or more a week.

Orozco hasn't ruled out leaving Merced County for Santa Clara in search of more job opportunities.

"I have a little bit of money left from my old 401(k), but that's probably going to run out in the next couple of months," he said. "It's a lot of pressure right now to try and get something steady."

Brown is facing much of the same pressure.

He does have experience in various fields, such as working with security equipment, but he said the local job market is saturated and getting into it is a challenge.

To improve his chances of finding a job where he could come home at night to take care of his kids, Brown went through vocational training in accounting.

But he got a letter a week and a half ago informing him that his federally extended unemployment benefits, which were supposed to last until Feb. 13, would expire at the end of the month.

He was getting $450 a week, which he used to support himself and his two kids.

Brown was hoping to use his additional time to search for an accounting job, but now he has to race to find some immediate work to support his family.

"Right now, I don't know what my next option would be," he said.

Bee staff writer Marijke Rowland can be reached at mrowland@modbee.com or (209) 578-2284. Follow her on www.twitter.com/turlocknow.

Reporter Mike North can be reached at (209) 385-2453 or mnorth@mercedsunstar.com.

How it works

Before the recession, most Californians were eligible for a maximum 26 weeks of state unemployment benefits, paid by their employer.

In June 2008, Congress began federal extensions that gave unemployed workers a maximum 73 additional weeks (99 weeks total) of benefits to help during the recession.

In May of this year, the number of federal extensions for which Californians were eligible dropped because of improvements to the state's jobless rate, so they could receive only up to 73 weeks total (between state and federal) of benefits.

On Dec. 29, all of the federal benefits are set to expire nationwide, and everyone eligible or receiving extensions would have their payments stopped on that date.

Congress could vote to approve another extension of the federal benefits as part of its ongoing "fiscal cliff" negotiations.

Some 920,000 people qualify for benefits in California and some 400,000 would lose their benefits when the federal extensions expire.

Some $284 million a week in unemployment is paid to Californians between state and federal benefits.

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