05/03/2013 07:15 pm ET Updated Dec 06, 2017

Sequester And The Bay Area: Federal Cuts Are Felt At Home


Throughout the Great Recession, California's One-Stop Career Centers have served as way stations of hope, places where safety nets fashioned from state and federal unemployment benefits have helped the jobless stay afloat as the storm swirled around them.

This week, as word spread that the budget stalemate in Washington would mean a nearly 18 percent cut in federal extension benefits, these refuges seemed more and more like recessionary triage centers for the wounded. Slashing both benefits for claimants and operating budgets for the culled staff trying to help them, the federal sequester is now hitting home in a big way.

"I'm begging the government: Please don't cut these benefits," said Rosa Sanchez, a 50-year-old single mother from Santa Clara desperately seeking work since she was laid off after 10 years as an English development specialist for a local school district. "I share my apartment with my teenage son and my elderly mother, and we simply can't live without that help.

"I'm willing to work," Sanchez said during a visit last week to the Campbell center, "and they talk about a job boom in Silicon Valley, but there are no jobs available for me."

There's a lot at stake for these frustrated job-seekers. Under the law, the unemployed can collect up to 26 weeks' worth of state benefits, and then another 47 weeks of federal extension payouts. But as part of the so-called sequester cuts mandated by Congress in 2011 as a way to

force itself to cut the national deficit, California now will receive $250 million less from the federal government to hand out to those who have been out of work for more than 26 weeks. While another 500,000 Californians who have not reached their 27th week will continue to receive their state unemployment checks as usual, a nearly equal number of unemployed now face potentially drastic reduction in their personal budgets.

The irony of the sequester cuts has not been lost on the long-term unemployed. While they watched lawmakers hustle to restore funding for airport security slashed by the stalemate, these residents now into their second year of job-hunting feel unfairly singled out as their benefit reduction starts to kick in this week.

"To people who've been unemployed for a long time and are already struggling to hold on to the little they've got left, these cuts will be devastating," said Gay Plair Cobb, CEO of the Oakland Private Industry Council, which helps administer the Oakland One-Stop center. "Congress is essentially pushing people deeper into poverty."

The average long-term unemployed worker will lose $52 a week in benefits going forward. For jobless claimants such as East Oakland resident Stephen

Fitch, who rents a $300-per-month room and pays several hundred dollars more each month for food and transportation, a monthly drop of $200 means things soon will be cut much closer to the bone.

"I could go hungry, and I could become homeless, and if I do I'd be more undesirable to a potential employer if I can't shower and properly groom myself," said Fitch, a 58-year-old laid-off sales rep who came to the downtown Oakland center this week for career assistance. Like many other jobless workers, he's angry.

"(President Barack) Obama's done a good job helping us get these extended benefits while we've looked for work, but the Republicans are doing everything they can to hurt him," said Fitch, who currently gets about $150 a week in unemployment benefits. "It's politics run wild, and it's people like us getting caught up in the middle of it."

The cuts come at a particularly challenging time, given the spotty recovery that has even tech-booming Silicon Valley hovering at a 7.3 percent unemployment rate. And those reductions are compounded by an expected $30 million cut in federal funds to support the state's Employment Development Department over the next 15 months.

Already struggling with a $128 million federal funding shortfall in the past year, that agency has seen more than a 10 percent drop in staffing since the recession's peak in 2010. That means only about 8,550 employees remain to provide EDD services, which include helping the estimated 988,000 Californians now receiving either state or federal extension benefits.

"We have fewer and fewer people now to handle the rising demand for services," EDD spokeswoman Loree Levy said. "We're encouraging claimants to instead use our online resources, including our Facebook and Twitter pages and our how-to videos on YouTube. But the sequester means we'll have even more service-delivery issues in the coming weeks and months."

Levy said demand for benefits remains above pre-recession levels. "We paid out $22.9 billion (in state and federal unemployment benefits) at the peak of 2010, which was a record," she said. "Typically we'd pay $5 or $6 billion. So while demand remains at a historic high, we have greatly reduced levels of staffing from where we need to be."

It's unclear what, if anything, Congress might do later this year to blunt the effect of the sequester cuts. For now, the long-term jobless are bracing for an 18 percent cut in their twice-monthly unemployment checks, along with a slew of ripple effects.

At the Oakland One-Stop center, job counselor Aifen Chen says many of her clients may have to drop out of job training because of the sequester cuts. "If they can no longer support themselves with unemployment while taking these classes, they'll have to find temporary work somehow. And that means they'll have to stop the training that might have led them to their next job."

One morning last week, Mary Burns, of Antioch, came by the Oakland center. The single 60-year-old great-grandmother, who says she's been supporting herself since she was 15, lost her job as a customer service rep for a large bank because "I wasn't getting off the phone with customers in a timely manner. They give you a maximum of six minutes with each customer, and because I went beyond that a few times, they let me go."

Once her approximately $700 in monthly benefits is cut by 18 percent in the coming weeks, Burns says the loss of about $125 is "going to hurt me greatly.

"I'll have to cash out what's left of my 401(k)," she said. "I hate doing that. But I've got to survive."

Contact Patrick May at 408-920-5689. Follow him at

unemployment benefit cuts by the numbers:

988,000: Number of Californians receiving unemployment benefits

400,000: Number of unemployed workers who have already collected state unemployment for 26 weeks and will now be affected by the cuts in federal-extension benefits, which run another 47 weeks

$13.7 billion: Amount of benefits paid by the state's Employment Development Department for 2012

1,030,000: Number of unemployed workers in California who have run out of all available benefits

Source: Employment Development Department, Mercury News reporting

bay area residents certified to collect either state unemployment benefits or federal-extension unemployment benefits as of February

ALAMEDA: 28,859


MARIN: 2,920


SAN MATEO: 9,689



TOTAL: 117,342

Source: Employment Development Department ___