Walko votes for unemployment compensation extension, boost to Pa. economy

by state Rep. Don Walko

I was proud to co-sponsor and vote for a new law that will immediately help more than 25,000 people who have exhausted their unemployment benefits. This law will use federal stimulus dollars to extend benefits by seven more weeks for a total of 79 weeks.

This will help 25,430 people who had their benefits expire in July and the 60,000 people who will be affected before the end of the year. Thousands of families will get seven more weeks of benefits while they continue to look for new employment in this challenging job market.

Act 30 of 2009 (H.B. 1770) will make a temporary change to the Unemployment Compensation Expanded Benefits law to allow the state to draw nearly $145 million in federal stimulus funding.

According to the Department of Labor and Industry, the seasonally adjusted unemployment rate in June was 8.3 percent, unchanged from the previous month. That rate is up 3 percent from this time last year.

By taking this necessary step, we will assist thousands of families to put food on their family’s table and pay their mortgage and other bills. Since we’re using federal dollars, there will be no impact to the Unemployment Compensation Trust Fund or to businesses.

The average weekly unemployment payment in the state is $305, regardless of family size. This translates to $15,860 per year, a figure that is $6,190 below the federal poverty guideline for a family of four. Pennsylvania has lost nearly 180,000 jobs since the nationwide recession began in December 2007.

Besides putting money into the pockets of struggling workers, this bill will pump nearly $145 million into Pennsylvania businesses and the economy. Every dollar provided in unemployment compensation for residents will generate $1.44 of economic activity.

It is important to note that this is not a free ride. Recipients must prove they are looking for a new job.

The new law temporarily switches the mechanism Pennsylvania uses to trigger extended unemployment benefits from the current “insured unemployment rate” – the percentage of workers covered under the unemployment law who are out of work – to the “total unemployment rate” – the percentage of all workers in Pennsylvania who are out of work.

Under the stimulus law, the federal government will cover the cost of providing the seven additional weeks of unemployment benefits if Pennsylvania’s total unemployment rate exceeds 8 percent, which it has since May. Under Act 30, most Pennsylvania workers will be eligible for a total of up to 79 weeks of unemployment benefits, as long as the federal money is available.

The new law will only keep the alternative trigger in place while federal money pays for the extended benefits.

If you have a question about a state-related issue, please visit www.pahouse.com/Walko or call my office at 412-321-5523.