Unemployment -- on both sides of Atlantic
Washington — Pressure mounts on Congress and the White House to blunt the impact, both human and political, of the high unemployment that seems likely to grip the United States for some time to come.
Against the background of a July jobless rate of 9.8 percent - the highest since 1941 - Congress gropes toward a formula to extend unemployment benefits beyond the 39 weeks now available.
Since he came into office, President Reagan's policy has been to cut back on jobless benefits, as part of his overall budget-trimming program.
Now the President, with an eye to Republican fortunes in the coming congressional election, appears ready to endorse an additional 10 to 13 weeks of federal assistance to Americans out of work.
Nearly 2 million unemployed workers, says Janet L. Norwood, commissioner of the Bureau of Labor Statistics (BLS), have been out of work for 27 weeks or more.
A great many of these people will abruptly lose their jobless benefits at the end of September because of a change of law enacted by Congress last year with Mr. Reagan's backing.
At least a dozen states, including the President's home state of California, will be adversely affected by this change - a prospect hardly relished by politicians a month before the November election.
Already a number of other states have been forced by the revision to ''trigger off'' - that is, lose benefits beyond 26 weeks - causing many jobless Americans to live on their assets or apply for welfare.
The change in law came about like this:
During the 1974-75 recession, Congress passed two 13-week extensions of jobless compensation, to a maximum of 65 weeks. These extensions expired, leaving the nation with the basic 26 weeks, plus an additional 13 weeks when unemployment rises to a specified level.
The first 26 weeks of benefits are paid entirely by the states, from funds accumulated by a tax on employers, which varies from state to state. The cost of the extra 13 weeks is split 50-50 between states and the federal government.
If a state's coffers run dry, it can borrow money to pay jobless benefits from the Federal Unemployment Account. At present, said an official of the BLS, 16 states plus Puerto Rico, the Virgin Islands, and the District of Columbia owe FUA a total of $7.7 billion.
Until April 1982 these loans were interest-free. Now the borrowing states are obliged to pay interest averaging 10 percent. Few people expect the loans to be repaid. Indeed, over the years Congress has appropriated $16.3 billion to keep FUA solvent.
In 1981 President Reagan proposed and Congress accepted a two-step program to make it harder for states to qualify for an additional 13 weeks of jobless benefits beyond the basic 26. This was done by a complex formula, raising the level of unemployment at which the extra benefits would ''trigger in.''
The first part of this change went into effect last year. The second step, due at the end of next month, raises still higher the unemployment level which a state must experience before qualifying for benefits beyond 26 weeks.
Originally Mr. Reagan had expected that unemployment would be falling by the late summer of 1982. Instead, it is rising and may continue to climb over the short term. ''Unemployment,'' said Mrs. Norwood in a telephone interview, ''continued to grow for two months after the end of the 1975 recession.''
Such growth is a pattern, because unemployment is a ''lagging indicator.'' Employers, having been forced by recession to let people go, are slow to rehire when business turns up. They tend to recoup losses by getting more work, or productivity, out of their reduced number of workers, before taking people back.
It takes an economic growth rate of at least 3 percent, experts agree, before unemployment begins to drop significantly. Most economists expect the coming recovery, which may or may not have begun, to be weak - certainly not robust enough to make an early dent in jobless statistics.
Legislators of both parties face this fall's election campaign against a backdrop of more than 12 million Americans out of work, including a record number of 1.5 million so-called ''discouraged workers,'' who have given up looking for jobs and no longer are counted on unemployment rolls.
Small wonder that both the President and Congress are looking for some way to ease the burden of millions of Americans whose job prospects are bleak.