Thousands of South Carolina residents will lose their unemployment benefits at the end of the year as part of the federal budget deal.
The deal, passed this week by Congress, means that 12,900 residents will lose their federal unemployment benefits, according to the S.C. Department of Employment and Workforce.
Those jobless have exhausted their 20 weeks of state unemployment benefits and are in one of the three tiers receiving up to 29 additional weeks from the federal Emergency Unemployment Compensation program.
“It will be devastating for people who have been facing long-term unemployment,” said Sue Berkowitz, director of the S.C. Appleseed Legal Justice Center, which advocates for low-income South Carolinians.
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The loss of those federal benefits also will effect the state’s economy, when those people have difficulty paying their bills, including rent and keeping the electricity on, she said.
A lot of the long-term unemployed are victims of the bad economy, and the longer they have been unemployed, the harder it is to find work, Berkowitz said.
Before the recession, unemployed S.C. workers were able to get up to 26 weeks of jobless benefits from the state. Additionally, they could get up to 99 weeks of benefits through various extensions.
Clemson University economist Bruce Yandle said those extended benefits, put in place during the recession, were expected to end as the economy recovered.
The end of the benefits will have two immediate effects, hurting family pocketbooks and giving the labor market a push, Yandle said. “It will put a crimp in budgets as those checks stop coming in.”
It also will reduce the “unusually large” gap between the number of jobs open and the number of people seeking those jobs.
The extended benefits allowed the unemployed to postpone getting a job, spending more time searching for a job they liked as opposed to immediately taking a job they didn’t want.
“When those benefits begin to be reduced, people have no choice but to get out there and take that job,” Yandle said.