News Column

Unemployment Benefits Cut by 22 Percent in N.J.

June 6, 2013

Michael L. Diamond

Thousands of New Jersey residents who have been unemployed for longer than 26 weeks will see their benefits cut by 22 percent at the end of the month, a casualty of the federal sequestration.

The reduction comes as a surprise to job seekers such as Dolores Borowski, 69, of Manchester, who lost her job in February 2012, when her employer, Foodtown, closed one of its stores.

"It has an impact on people," Borowski said. "All these people that lost their homes and this, that and other things, how can they afford a 22 percent decrease?"

The federal government in March enacted massive budget cuts and tax hikes after Congress failed to reach an agreement on a plan to avoid the austerity measure.

Among the programs impacted: Emergency Unemployment Compensation, a federal program launched during the Great Recession to provide laid-off workers jobless benefits beyond the 26 weeks they receive from state unemployment programs.

The federal benefit for New Jerseyans lasts 47 weeks, essentially providing job seekers 73 weeks of benefits. Workers are eligible to receive two-thirds of their wages, up to $624 a week, in 2013.

The upcoming reduction comes as New Jersey's job market, while showing signs of improvement, remains slow. The state's unemployment rate rose from 4.6 percent when the recession began in December 2007 to a peak of 9.7 percent two years later. But it has declined only slowly; it was 8.7 percent in April.

The state's Department of Labor and Workforce Development sent letters to about 115,000 New Jersey residents who are at risk of seeing their benefits decline beginning June 30, cautioning them about the benefit cut, a spokesman said.

Also notable:

-- The payments will be reduced by 22.2 percent, rounded to the dollar.

-- The cuts don't affect state-funded benefits that unemployed workers receive for the first 26 weeks after they lose their job.

-- The reductions will remain in place through Sept. 28, the end of the fiscal year. It isn't clear if the program will continue.

Michael L. Diamond: 732-643-4038; mdiamond@njpressmedia.com

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(c)2013 the Asbury Park Press (Neptune, N.J.)

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Source: Copyright Asbury Park Press (NJ) 2013


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