Jobless Benefits – How Can We Possibly Know Who Really Needs Them?

In a recent article in Bloomberg BusinessWeek, Joshua Green does a nice job of laying out the case for another extension of jobless benefits.

It is true that this recovery is much slower than previous recessions, and some extension of benefits is probably in order.

However, the other side of the discussion (which his article did not address) is the reason(s) as to why the recovery is so slow, and what changes in tax, monetary and fiscal policy might be attempted in order to stimulate a sharp increase in job creation. Unemployment insurance is temporary relief, but economic growth is the long term repair of the situation.

I have known three women who have been unemployed at various times, going back to the depths of the recent recession. One, a bright and energetic young woman, used the benefits to keep her going during the six months it took her to (very actively) seek and find a new position. The other two women, when faced with the expiration of their 99 weeks of benefits, each told me (separately) that she “guessed it was time to start looking for a job”.

How can we ever know who will use these jobless benefits as a temporary crutch, and who will use it as a long-term way to support a lifestyle? We can’t know, which is why we need to do whatever it takes to create jobs, and then this extension of benefits discussion will become unnecessary.