Advocates: Suspending benefits motivates unemployed workers

? Unemployment benefits are a lifeline, but some economists contend they can give job seekers a reason to turn down work.

A debate among politicians is likely to heat up as the U.S. Senate resumes session this week. Senators declined, for the fourth time, to act on an unemployment insurance extension before its July 4 break. A new bill passed by the House faces obstacles, including its $33 billion price tag.

Economists and think tanks on the right say extending benefits can make the unemployed less motivated to look for work. Proponents counter that any incentive to skip work to collect benefits is minimal and that unemployment benefits keep people from permanently dropping out of the labor force.

Some unemployed workers have refused jobs because the pay is too low to give up unemployment payments, some staffing companies say. Other workers declined jobs because they couldn’t afford or didn’t want to commute from their homes to a job.

“We have positions open, and we can’t sell them,” said Sue Romanos, president of staffing firm CareerXchange, which has offices in Florida’s Broward and Miami-Dade counties. Her firm has offered some workers customer service jobs at $10-$15 an hour and been turned down.

“The reason is they’re collecting unemployment,” Romanos said. “By the time you take off taxes, it’s the same amount they’re getting from the government.”

Unemployment payments normally are 26 weeks, but were temporarily extended in the recession to up to 99 weeks for hardest-hit states. Legislation in the Senate would provide relief for jobless workers who had not yet exhausted all available extended benefits. Their benefits lapsed when federal emergency authority expired June 2.

More than 2.5 million unemployed workers who have since lost benefits hope their payments will soon resume. Mark Magula, 55, of Plantation, Fla., is selling assets such as his lifelong guitar collection to make ends meet. Magula, a former loan officer for a mortgage company, said he has been trying to find a job. His wife Cindy, 56, and son Matthew, 28, lost their jobs last year when their employer, a local research company, closed its doors.

Any unemployment benefits the family was drawing expired June 2. Magula has been offered commission-only jobs. But sales prove tough to generate, and the jobs end up costing him money. “It’s like working for free,” he said.