Virginia’s slow-but-steady economic recovery spells the end of unemployment benefits for those out of work the longest.
About 5,700 Virginians claiming unemployment for 18 months or longer saw their benefits terminated this week, even though they had expected to receive them for another three months. For the first time since 2009, unemployment in Virginia remained below 6.5 percent for three consecutive months, triggering the end of a 13-week Extended Benefits Program funded by the federal government.
Less than 7 percent of the 82,500 Virginians who received unemployment checks this month will be affected. They were notified in letters mailed last week by the Virginia Employment Commission, said Research Director Don Lillywhite.
“It may come as a surprise, but it’s not like you get a check one day and the next week you don’t without being notified,” Mr. Lillywhite said.
Thanks to a bubble of economic prosperity around Northern Virginia that is largely propped up by federal government and contracting jobs, unemployment in the state has remained roughly three points below the national average, which topped 10 percent last year and currently sits at 8.7 percent.
“It was not a terrible surprise to see us go below 6.5 percent,” he said. “To us it signifies that things are getting better in the state of Virginia.”
Still, Mr. Lillywhite cautioned that it will be a long time before the state once again experiences its prerecession unemployment levels of around 3.5 percent.
“It would be wonderful to get back to that level, but I’m not sure we or the nation are going to get anywhere close to where it was four years ago anytime soon,” he said. “We’re improving by small strides.”
Extended Benefits have expired in other states, including Tennessee and North Carolina and Wisconsin, but largely because legislatures did not take the required steps to renew them.
A series of other federally funded extensions to unemployment benefits remain as a result of lawmakers’ efforts to help long-term job seekers cope with the economic recession. Since 2008, Congress has expanded eligibility for unemployment from 6 1/2 months up to nearly two years. Now that Virginia has been disqualified from the Extended Benefits program, the unemployed will still be eligible for up to 18 months of benefits.
During the first 6 1/2 months of unemployment, Virginians may receive payments from the state based on their income earned in the year before becoming unemployed — as long as they meet certain requirements like showing they are actively looking for work. The maximum allotment is $378 per week.
After the initial time period is up, the federal government will issue payments of 80 percent, 54 percent and then 50 percent of the original entitlement.
Virginia’s unemployment trust fund ran dry in October 2010 as the number of claimants skyrocketed, leaving the state unable to pay benefits. To meet obligations, officials borrowed $487 million from the federal government, which they will have to pay back with interest, Mr. Lillywhite said.
“I suspect we’ve borrowed every week for many, many weeks,” he said.
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