As a part of the fiscal cliff negotiations, Congress passed an extension of the Emergency Unemployment Compensation (EUC) program this week.
Benefits will be extended through the end of the year for Illinois workers collecting EUC. However, since new weeks for the federal unemployment insurance program were not added by Congress, those who have exhausted EUC are not eligible for additional unemployment insurance benefits.
Since every $1 in unemployment insurance leads to $1.63 in economic activity, the extension of the EUC program will support the slowly growing economy. Without the extension, 90,000 claimants in the state of Illinois would have received their last EUC payment over the next two weeks. Also, over 2,800 people would have completed Illinois' Regular Unemployment Insurance program each week. Those individuals would not have access to the federal EUC.
Despite the extension, the Illinois Department of Employment Security stands to lose $17 million in operating funds along with an $11 million annual cut since fewer people are collecting state unemployment insurance.
IDES' operational funding comes entirely from the federal government and funding is tied to the number of people collecting unemployment insurance. However, even though the numbers of claims is 38 percent higher than prior to the recession, fewer people are collecting state insurance, therefore cutting funding.
As a result of the lack of funding, 216 intermittent IDES employees are no longer being scheduled, eight offices have been consolidated, and ten outpost locations shared with partners have been vacated. The office may be forced to further reduce service.
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