WASHINGTON (AP) — Extending the current level of long-term unemployment benefits for another year would add 300,000 jobs to the economy, according to a report from the Congressional Budget Office.
The analysis released Wednesday from the nonpartisan office estimates that keeping jobless benefits would cost the government $30 billion. But it would also lead to more spending by the unemployed, boosting demand for goods and services and creating new jobs.
Federal long-term unemployment benefits are set to expire on Dec. 29 for more than 2 million workers unless Congress approves an extension. Democrats have called for reauthorization of extended benefits, but Republicans generally oppose more jobless aid without additional spending cuts to offset the cost.
"This report is more evidence that extending help to those who are seeking work is a better investment for our economy than extending tax breaks for those resting comfortably atop the economic ladder," said Rep. Lloyd Doggett, D-Texas, a member of the House Ways and Means Committee.
Regular jobless benefits generally last up to 26 weeks for eligible workers who lose their job and are seeking employment. Since the recession began in 2008, the federal government has offered up to 47 weeks of additional benefits.
The CBO report found that for every dollar of jobless benefits that the unemployed spend, there is a $1.10 boost to the economy.
Any deal on reauthorizing some or all extended unemployment benefits is likely to be part of ongoing negotiations over avoiding the "fiscal cliff" tax increases and spending cuts that could send the economy back into recession.
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