The Star Beacon; Ashtabula, Ohio

May 4, 2013

Ohioans to see federal unemployment benefits cut

By LISA CORNWELL
Associated Press

CINCINNATI — These days, the only dates Richard Crowe takes his wife on are hunts for bargains at the grocery store.

Crowe, of Wintersville, was laid off last year from RG Steel’s coke plant in nearby Follansbee, W. Va., after 34 years with the company. He is among the Ohioans who will see their unemployment checks cut about 16 percent, or an average of about $50 a week, as federal benefits in Ohio are reduced beginning Sunday. Reductions are required of all states under automatic federal spending cuts.

Crowe has relied on unemployment compensation to help pay for necessities like electricity and water and is worried about how he will pay his bills.

“We’re already living on the bare essentials,” Crowe, 54, said. “But we will have to try to cut back even more, if possible.”

When unemployed Ohioans run out of eligibility for state benefits after 26 weeks, they can move into the federal program. About 37,000 people now receive the federal jobless benefits in Ohio, though state officials don’t know exactly how many will be affected by the spending cuts.

The federal program consists of two stages of benefits of 14 weeks each. A third nine-week stage will be available starting Sunday because Ohio’s most recent three-month average unemployment rate increased to about 7 percent. Only states with unemployment rates at 7 percent or above qualify for that stage.  

The average weekly compensation of around $313 a week will drop to about $263 for Ohioans when they enter the federal benefits program or move to a new stage within the program, state officials say. The Ohio Department of Job and Family Services estimates the total reduction will amount to $25 million between now and the end of the federal fiscal year, Sept. 30.

Currently, 91,000 Ohioans receive regular state unemployment compensation, and those benefits won’t be cut, said Job and Family Services spokesman Benjamin Johnson.

Despite the extension, Crowe says the reductions will hurt.

“We already don’t travel anywhere or eat out, and if I can’t make payments for my son’s college education, we could lose our home,” he said.

Crowe says he searches seven days a week for employment, but “it’s tough for older workers to find a job.”

While states are allowed to set their own times and methods, the goal is to get all states to implement the reductions before July, according to a U.S. Department of Labor spokesman.

“The earlier, the better,” said Jason Kuruvilla, who says the longer it takes to make the cuts required by the end of the federal fiscal year, the deeper individual cuts will have to be.

Ohio is among about 25 states to implement the changes so far and one of at least four not making across-the-board cuts, according to the New York-based National Employment Law Project.

“Not cutting across the board means a state has to get the same amount of money out of fewer people, and we think it would be fairer to spread them out and keep individual cuts lower,” said Maurice Emsellem, policy co-director for the nonprofit research group that promotes policies to help low-wage and unemployed workers.

But Johnson says that “while reducing everyone’s benefit at once may have resulted in a slightly smaller reduction, it would not have given people time to budget and prepare, which was one of our primary goals.”

Zach Schiller, research director for the nonprofit Policy Matters of Ohio, said that $50 cuts will be significant for many, regardless of when they are made.   

“Getting $300 a week keeps some people out of poverty,” he said. “And to reduce that is cruel.”