From the New York Times
State Jobless Rate Soars; Benefits Extension Seen
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By PATRICK McGEEHAN
Published: January 22, 2009
Unemployment in New York State rose last month at the fastest pace on record, as some companies laid off workers at a rapid clip while others refrained from their usual hiring around the holidays, the State Labor Department reported on Thursday.
The state’s jobless rate, which is adjusted for seasonal fluctuations, was 7 percent in December, up from 6 percent in November, according to the report. That increase — the largest in any month in 32 years of state record-keeping — will set off another extension of benefits for many New Yorkers who have been looking for work for more than half a year, labor market experts said.
New York City’s unemployment rate, after seasonal adjustments, rose even more, jumping to 7.4 percent from 6.3 percent, the Labor Department said. The city’s count of private jobs declined by 8,500 in December, compared with a normal increase of almost 20,000 jobs in that month.
The national unemployment rate, which, at 6.8 percent in November, was considerably higher than the state and city rates, rose to 7.2 percent in December.
Across the state, more than 670,000 people were reported as unemployed in December, a record one-month increase of 89,800 from November. More than 500,000 New Yorkers are currently collecting unemployment benefits and about half of them have already exhausted the standard allotment of 26 weekly checks.
Those who failed to find work before their standard benefits ran out have been able to collect up to 20 weeks of additional benefits. Now that the state’s unemployment rate has averaged more than 6 percent for the last three months, an additional extension of 13 weeks of benefits will become available on Feb. 22, according to Andrew Stettner, deputy director of the National Employment Law Project, an advocacy group for the unemployed.
That extension will help thousands of New Yorkers who have already used up 40 weeks of benefits, but it will also put additional strain on the state’s insolvent unemployment insurance fund. The state has been borrowing about $90 million each week this year from a federal fund to cover the shortfall in the unemployment fund.
State officials project that the fund’s deficit will grow to more than $2.5 billion by the end of 2010 unless changes are made to the relatively low payroll tax system that feeds the fund. On Thursday, labor unions and advocates for low-wage workers called for legislation to overhaul the system and increase unemployment benefits. New York’s maximum weekly unemployment benefit of $405 is lower than those of all of its neighboring states.