Unemployment drop ends extended benefits for jobless Minnesotansby Annie Baxter, Minnesota Public Radio
St. Paul, Minn. — Thousands of unemployed Minnesotans could find bad news in their mailbox today, if they haven't already.
State officials sent letters notifying them that their extended federal unemployment benefits will stop next month.
Minnesota's jobless rate has now fallen below an average of 6.5 percent over a three-month period, and that's spells the end of the last-resort unemployment insurance program. Extended benefits can be taken for up to 13 weeks, and workers qualify for it only after exhausting all other jobless benefits available to them.
Because unemployment in Minnesota has dropped to 5.9 percent, the state no longer qualifies for the federal extended unemployment benefits program. As a result, those payments will be cut off for Minnesotans in mid-January.
Rick Caligiuri, director of the state's unemployment insurance division, questions whether there are enough jobs available to put the Minnesotans on extended benefits back to work. His agency steer them towards resources, including food stamps, cash assistance and health care administered through the state Department of Human Services — and food shelves.
"We've been trying to do more than we've ever done for people who are going off or exhausting [benefits]," he said.
About 5,500 people on extended benefits have been informed that they will soon lose them, Caligiuri said. Another 8,500 or so Minnesotans who are in the pipeline for that program also have received notice of its termination.
Gov. Mark Dayton, who recently wrote the state's Congressional delegation about plight of the states long-term unemployed, said he wants Congress to temporarily reduce the cutoff threshold from 6.5 percent to 5.5 percent. That would buy jobless Minnesotans more time on those extended benefits.
Dayton and 15 other Democratic governors also are urging Congressional leaders to continue federal funding for both the "extended benefits" and a so-called "emergency benefits" program. Both are due to expire Dec. 31. The governors say letting the programs expire could drain the resources of nearly 2 million jobless Americans starting in January.
The uncertainty about the future of unemployment insurance comes during a time when state officials say they can't get a good read on how Minnesota's economy is performing.
"Nationally, jobs have continued to grow, and unemployment has come down," said Steve Hine, Minnesota's head labor market analyst. "And it is a bit confusing as to why Minnesota's payroll jobs count is not reflecting a similar strength."
Hine notes that even as the state's unemployment rate fell in November, employers indicated they dumped nearly 14,000 jobs.
But Hine is skeptical of that number. He said over the past year, the Bureau of Labor Statistics has taken charge of calculating the payroll jobs numbers for the states.
Hine said the bureau has ignored important information from his department about the Minnesota jobs situation. He also thinks federal officials are interpreting the raw jobs numbers in a way that is masking strengths in the state's economy.
"My sense in looking at our own numbers and in talking to a lot of other states across the nation, we do face a threat to the quality of this information," he said. "It's very disappointing."
A spokesman for the Bureau of Labor Statistics said officials there are in regular contact with the Minnesota Department of Employment and Economic Development, and have received adequate feedback on the data.
Also skeptical of the data is Scott Anderson, a Minneapolis-based economist with Wells Fargo, who thinks that the official job counts make the state look like it's in recession.
"We've got three months of job losses, and they're broad-based across sectors, except for health care," Anderson said. "We're not seeing the same trends nationally. And we do know that Minnesota does tend to track along with the nation, so the fact that Minnesota would be such a big outlier here is a bit of a mystery."
Anderson said economic policy makers in the state are essentially flying blind, given the uncertainty about the data. He said that could have major implications for tax policy and the state's budget.
So far, however, no one suggests that Minnesota's long term unemployed will be losing their extended benefits based on questionable unemployment numbers.
If anything, state officials have said Minnesota's jobless rate has been running higher than it should lately, meaning it may have prolonged the availability of benefits.
- Morning Edition, 12/16/2011, 7:25 a.m.