It’s too early to cut back on unemployment benefits

Congress is debating whether to renew legislation that extended unemployment insurance benefits for the long-term unemployed for up to 99 weeks (providing 73 weeks of federal benefits beyond the regular 26 weeks of state-financed benefits in most states). A good benchmark for testing whether this is a good idea is to determine if the long-term unemployment situation has improved enough to warrant discontinuing extended benefits or shortening the length of time unemployment benefits can be received.

shows the share of unemployed workers who have been out of work for more than six months, the maximum length of regular benefits in most states. There has been little discernible improvement. The share of the unemployed who have been out of work for more than six months shot up from a 17.