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Increased jobless rate casts benefits fight in new light

Two separate bills that would extend unemployment benefits for a year may come up for votes in Washington on Saturday, even as politicians and economists respond to Friday's disappointing jobs report from the Labor Department.

Steve Nathan was among those headed from Philadelphia to Washington on Wednesday to back extended jobless benefits. (Alejandro A. Alvarez / Staff Photographer)
Steve Nathan was among those headed from Philadelphia to Washington on Wednesday to back extended jobless benefits. (Alejandro A. Alvarez / Staff Photographer)Read more

Two separate bills that would extend unemployment benefits for a year may come up for votes in Washington on Saturday, even as politicians and economists respond to Friday's disappointing jobs report from the Labor Department.

The nation's payrolls added a meager 39,000 jobs in November, far fewer than needed to make any sizable dent in the nation's unemployment, which increased to 9.8 percent, the department reported.

The rate was up from 9.6 percent in October, a month when 172,000 jobs were added. The November addition was considerably smaller than expected.

Most observers do not expect either of these bills to pass immediately, said Judy Conti, who watches the legislation for the National Employment Law Project, an advocacy group. The legislation links the benefits to tax relief for the middle and upper class.

But, she said, a consensus is emerging in Washington, with both Republicans and Democrats backing benefit extensions. "One year is what everyone is talking about," she said. "What seems to be left is whether it will be paid for" or funded with deficit spending.

The debate in Washington continued as the number of unemployed grew by 276,000 to 15.1 million in November, the Labor Department said.

Many economists had been predicting the addition of nearly 150,000 jobs last month. The economy has recently flashed signs of gaining momentum with busier factories, rising auto sales, and a good start to the holiday shopping season. But that didn't translate into mass hiring in November.

"Only 39,000 jobs created in November is awful," said Peter Morici, an economist at the University of Maryland. "After we back out health care and social services, which are largely government funded, the private sector is not creating permanent jobs - none, zero, nada."

Federal and state extensions to unemployment benefits began to be phased out last month. This month, 83,000 Pennsylvanians, including nearly 18,000 Philadelphia residents, will run out of benefits - more than ran out during the previous 11 months.

"We need Congress to vote yes to extending unemployment to help those of us who through no fault of our own" are out of work, said Mavis Menin, 63, of Glenside, who traveled to Washington on Wednesday to lobby Congress to extend benefits.

The average length of unemployment is now nearly 34 weeks - two months longer than the initial 26 weeks of unemployment benefits funded by states.

In Delaware, a thousand people a week will exhaust their benefits, state officials say. The situation is not as dire in New Jersey because of the way the state funds extended benefits.

Menin, a social worker, has been out of work since October 2009 and now fears losing her home.

With many economists predicting that unemployment will remain high well into next year, November marks the 19th month that unemployment stayed above 9 percent.

That's the longest stretch on government records going back to just after World War II. The last time it came close was 18 months during the recession of the early 1980s, with a rate topping 9 percent persisting until September 1983, nine months after the recession's official end in November 1982.

The current recession officially ended 17 months ago, in June 2009, but hiring prospects seem unclear.

Monster.com, which tracks online hiring, said that job postings continued to trend up in Philadelphia with particular demand in transportation and material moving, health care, and administrative support - mirroring the news in Friday's Labor Department report.

And the Institute of Supply Management's non-manufacturing employment index is moving up, buttressing trends in the jobs report. ADP, the payroll-processing company, reported an increase in small-business hiring, but another payroll company, CBIZ Payroll Services, saw a decline among companies employing fewer than 300.

The increases were not enough to offset declines in construction, manufacturing, retail, financial activities, and government hiring with a hemorrhaging loss of 14,000 jobs in local government, the Labor Department reported.

A recent survey of area human-resource managers provides a less-than-bullish outlook.

"The long and short of it is that it is a mixed bag," said Justin Schakelman of Careerminds Group Inc., a Delaware company that designs web-based job-search counseling for the unemployed.

Careerminds, working with Rutgers University, surveyed 80 professional human-resource managers at a regional conference in October. Of those, 50 percent expected to increase employee head count in 2011, while 42 percent expect to maintain the status quo. Eight percent said they planned to reduce head count.

Companies plan to hire clerical and administrative support, a sign that they need to ease the burden on overtaxed middle and upper managers, who have been pressured to do more, Schakelman said.

Just last week, area employers, including Express Scripts Inc., Sunoco Inc., the City of Camden, and Comcast, announced layoffs totaling more than 1,000.

"This remains a frustrating half-speed recovery," said Robert Dye, senior economist for PNC Financial Services in Pittsburgh, encouraged by some recent positive labor market news. "However, I do not expect to see a slump into a double-dip recession."