Cuts ahead for Alabama unemployment compensation
by Patrick McCreless
Apr 04, 2013 | 7228 views |  0 comments | 10 10 recommendations | email to a friend | print
Federal budget cuts will reduce the unemployment compensation benefits of 16,500 Alabamians by 12.8 percent this year.

The Alabama Department of Labor announced Thursday that due to the federal budget cuts known as sequestration, Alabamians receiving emergency unemployment compensation can expect to see a 12.8 percent reduction in benefits from April 28 through Sept. 30. The cuts could mean significant hardship for benefit recipients and greater use of already overburdened local charities, economists and nonprofits say.

According to the Department of Labor, residents receiving regular unemployment benefits should not be impacted by the cuts, just the 16,500 Alabamians receiving emergency benefits. Figures regarding how many Calhoun County residents receive emergency benefits were unavailable Thursday.

"Regular unemployment benefits is generally defined as covering up to 26 weeks ... and that's what the state pays," said Tara Hutchison, spokeswoman for the Department of Labor. "Anything after 26 weeks is emergency unemployment and that is what the federal government pays."

Alabama unemployment recipients an average of $207 per week, Hutchison said.

Keivan Deravi, economist at Auburn University Montgomery, said the cuts will be significantly burdensome for benefit recipients.

"The benefits are a safety net ... they use that to buy necessities," Deravi said of recipients. "Many of them don't have a savings account so if the benefits are removed, that void will be significantly felt."

Calhoun County has been hit with multiple layoffs this year. Most recently, the Anniston Army Depot laid off 371 employees March 30 due to the continued drawdown of the Afghanistan war.

Maudine Holloway, executive director of the Community Enabler Developer in Anniston, said her charity has already been inundated with an increase in requests in recent months and expects the trend to continue as residents lose their benefits.

"It's only going to get worse with more people being laid off," Holloway said. "We are seeing people we have not seen before — a lot of elderly and a lot of unemployed."

The Community Enabler is a nonprofit that provides low income residents with basic needs like food and clothing.

"We're getting a lot of requests for food assistance, clothes, help with utilities, the whole nine yards," Holloway said.

Due to the steady stream of requests, if it were not for the food donations from a few businesses, including the recently opened Publix Super Market in Oxford, the Community Enabler would have significant trouble helping residents, Holloway said.

"We're really running on the grace of God," Holloway said.

Deravi said, however, that though benefits are being cut, fewer Alabamians are requesting unemployment compensation.

"That has been steadily going down this year ... the number of new additions to the compensation group has been decreasing," Deravi said. "These are positive things."

Staff writer Patrick McCreless: 256-235-3561. On Twitter @PMcCreless_Star.

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