Unemployment rate improvement ends extended benefits

Posted: Monday, October 11, 2010

Alaska's unemployment rate fell below 8 percent during the summer, but that economic improvement may be bad news for some still out-of-work Alaskans.

When Alaska's unemployment rate dipped below 8 percent for three straight months, it meant that Alaskans who have been getting extra unemployment benefits because of the recession will no longer be eligible to receive them, according to the Alaska Department of Labor and Workforce Development.

With extended benefits, claimants who had previously been eligible for 20 weeks of unemployment will revert to 13 weeks, said Bill Kramer, chief of unemployment insurance program for Alaska.

What made Alaska workers eligible for the extended benefits was a designation in the state of a "High Unemployment Period," after the unemployment rate spent a protracted period above 8 percent.

"This is the first time we've ever triggered on the High Unemployment Period," Kramer said.

If the seasonally adjusted rate falls below 8 percent, which it did in June, July and August, that eligibility ends. June's rate was 7.9 percent, with July and August both at 7.7 percent.

Letters will be sent immediately to about 1,200 claimants who will be affected immediately, he said. The designation ends Oct. 16.

Some of those losing the extended benefits may be eligible for a separate, emergency program, he said. Those losing the extended benefits will be notified of how to apply for other benefits that might be available, Kramer said.

The extended unemployment benefits are a federally funded program. They are designed to work with state unemployment insurance programs to help not just those who have lost their jobs, but to minimize the effect on the larger economy, Kramer said.

"We have the unemployment program to keep that money in the economy during an economic downturn," he said.

During the last year, unemployment compensation, both state and federal, pumped $331 million into the state's economy, he said.

One reason for unemployment insurance "is to help the individuals with a little bit of cash so they can buy groceries and pay rent until they can get back to work, but part of it is also to lessen the effect of the downturn," Kramer said.

• Contact reporter Pat Forgey at 523-2250 or patrick.forgey@ juneauempire.com.

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