Federal jobless benefits get yearlong extension

By Vicki Needham - 01/02/13 05:56 PM ET

A yearlong extension of unemployment insurance for the long-term jobless landed in the final agreement on tax and spending issues cleared late Tuesday night by Congress, preserving benefits for more than 2.1 million people.

The $30 billion extension, which was not offset by other spending cuts, skirted any last-minute objections as part of the deal worked out by Senate Minority Leader Mitch McConnell (R-Ky.) and Vice President Biden.

"The deal preserves a vital lifeline of support for 2 million long-term unemployed workers who faced an abrupt cut-off of all jobless aid this week, and for millions more who will run out of state unemployment insurance during 2013," said Christine Owens, executive director of the National Employment Law Project, in a statement on Wednesday.

House and Senate Democrats, along with President Obama, have pressed vigorously for an extension to stave off the loss of benefits that expired Dec. 29 and would have stopped weekly checks to more than 2.1 million workers who have been out of work for at least six months.

Although advocates said they felt confident that lawmakers would back an extension, Republican leaders focused on the heftier tax-hike and spending-cut provisions and never really weighed in on the program's future.

But as negotiations trudged on through New Year's Eve, the extension got a thumbs-up for inclusion.

"With unemployment insurance preserved through 2013, Congress and the President must now work together on meaningful job-creation measures," Owens said.

Those benefits expired Dec. 29 and workers faced the first week of the new year without any aid.

The flow of December jobs reports starts Thursday morning with ADP's release of private-sector job growth followed by the Labor Department's figures on Friday.

Jobs growth is expected to come in around 150,000 for the combined public and private sectors, a modest increase and still two slow to significantly lower the unemployment rate.

Employers added 146,000 jobs in November and the jobless rate dipped to 7.7 percent, mostly because fewer people were looking for work.

An extension provides a maximum of 47 weeks of federal benefits. Combined with state-level benefits, the long-term unemployed would have a minimum of 34 weeks of benefits and a maximum of 73 weeks.

The length of federal benefits is linked to individual jobless rates in states and is based on a three-month average.