Many laid off get no benefits

On Friday, when the Chrysler plant in Newark, Del., shut its doors, more than 1,000 autoworkers joined the ranks of the unemployed.

At least they will be able to get unemployment insurance.

Most jobless workers can't.

Across the U.S., only 37 percent of workers who lose their jobs typically collect unemployment benefits, according to Labor Department statistics.

They often miss out because they didn't earn enough while working, or their work history was not continuous enough to make them eligible under state unemployment laws

One year into the recession, when the number of unemployed has risen to 10.3 million, there is a real question about where federal unemployment dollars should go.

Should they be sent directly to states' strained employment trust funds, enabling states to keep from raising unemployment taxes on already beleaguered employers? Or should they go to expanding eligibility, supporting states whose policies provide help to more people, who in turn will spend their benefits and boost the economy?

Last year, that approach became part of a federal bill -- the Unemployment Insurance Modernization Act -- passed in the House, but not the Senate. Then-Sen. Barack Obama was a sponsor.

"I think it's a shock to people that the safety net is in such sad shape," said Maurice Emsellem, co-policy director at the National Employment Law Project. "A lot of people fall through the cracks."

Advocates such as Emsellem always try to expand benefits in tough times, said Douglas J. Holmes, president of the National Foundation for Unemployment Compensation and Workers' Compensation, a Washington business group.

It would be better to skip the debate and ship the money to the state trust funds quickly, he said. "Federal money is not designed to dictate benefits state by state."

Those who fall through the cracks tend to be low-wage, part-time, seasonal or new workers.

"Although low-wage workers were almost 2½ times as likely to be out of work as higher-wage workers, they were about half as likely to receive benefits," said a U.S Government Accountability Office report written last year.

Unemployment insurance began in 1935, primarily as a safety net for people furloughed from full-time jobs but who expected to return to them.

These days, most people who are laid off don't get called back. People change jobs frequently, cobble together part-time jobs, or work as independent contractors.

"Today, the work force is very different, and this is the heart of the matter," said former Labor Secretary Robert Reich, who served under President Bill Clinton.

That's the macro-picture. The micro-view has to do with when eligibility kicks in -- a technical issue with huge ramifications. Most states give benefits based on minimum pay earned, minimum amounts of time worked and reasons the person is unemployed.

As a result, many people with short or sporadic work histories don't qualify. Recent college graduates may not receive unemployment benefits if they started their jobs in June and were laid off this month.