Thousands of workers laid off immediately after Sept. 11 have lost their unemployment benefits, exhausting the 13- week extension that was passed in March. But the big corporations are still collecting the tax cuts that Congress gave them as part of the unemployment extension package.

Workers laid off before Sept. 11 weren’t covered by the extension – they exhausted their benefits long ago. And the majority of workers, no matter when they lose their jobs, don’t qualify for any benefits at all. “Struggling workers are finding an unemployment insurance safety net that is full of holes,” according to Maurice Emsellem of the National Employment Law Project, as quoted in a Connecticut Post story.

That story’s headline gives a more upbeat impression: “Jobless rate drops for May,” it declares on the front page of the Business Section. This is fairly typical of the way most media treated the June 7 release of the official Bureau of Labor Statistics (BLS) report on May’s employment picture, showing a decline from 6 percent to 5.8 percent.

In fact, the official unemployment rate has fluctuated between 5.5 percent and 6 percent for the past six months. There have been one-month gains, but they have been “corrected” the next month. As Dean Baker, from the Center for Economic and Policy Research, puts it, “It is common for monthly employment reports to overstate job growth in a recession.”

While the pace of layoffs has slowed since December, jobless workers are still not being rehired. Compared with a year ago, there are now two-and-a-half times as many workers who have been without jobs for more than six months. Business Week reports that workers are staying unemployed longer than in the last recession, and “the burden of extended unemployment is falling hardest on older workers.”

Older workers are not the only victims. Graduating students are having a hard time finding jobs, and the official unemployment level for African Americans has been above 10 percent for the last three months; for Black youth the figure is over 30 percent.

Manufacturing jobs are still being lost, though at a slower pace than last year. Production workers are being laid off faster than managers and engineers. Without a major change in government policy, many of these job losses will be permanent.

While the BLS reports an “official” unemployment rate is 5.8 percent, it also reports alternative measures of unemployment. Counting everyone who wants a job, or works part time but needs full-time work, the figure would be 9.5 percent. Putting this in human terms, there are 8.3 million unemployed workers in the United States – 13.6 million if you count the hidden unemployed.

What can we expect in the future? Business Week says, “Growth is off to a good start – and signs point to more hiring ahead.” Here are some reasons to be skeptical:

* Government employment has continued to grow slowly, pushed by increases in education. As states and cities confront budget shortfalls, government employment will slow, or even decline. This will be a long-term problem unless state policies shift toward taxing the rich and federal priorities change.

* A higher rate of inflation, along with a continuing shift from manufacturing jobs to lower-paying service jobs, means that average real wages have started to decline, after a few years of small increases. Along with high household debt, lower wages will lower consumer demand.

* New investment will be slow, because there is still excess capacity in many sectors of the economy.

There are political factors which can work to create jobs and raise living standards:

* In many states, movements have developed against corporate welfare. Legislation has been introduced to restore corporate taxes and taxes on high-income individuals, making it possible to preserve and extend state jobs in education and other services.

* The 2002 elections are an opportunity to wrest control of Congress from the Republican right. This would be a first step in changing federal priorities in taxation and spending.

* Labor, civil rights, peace and environmental organizing is increasing. These can provide the popular base necessary to affect changes in policy.

The author can be reached at arthur.perlo@pobox.com

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