Stimulus Funds to Help Unemployed Minnesota Workers

Press Release

Minnesota will receive $130 million to help make unemployment payments to laid-off workers. The American Recovery and Reinvestment Act allocated $7 billion to the U.S. Department of Labor to help states meet increased demand on their unemployment insurance programs caused by the economic downturn.

"We are seeing layoffs across Northeast Minnesota, in Kanabec County the unemployment rate is 17.3 percent," said Congressman Jim Oberstar. "Steelworkers who are losing their jobs on the Iron Range did not cause this economic downturn, neither did the loggers, sales clerks, car dealership employees across Minnesota. They deserve a helping hand during tough times."

Minnesota qualified for the additional funding because of recent reforms in the unemployment insurance program. State lawmakers enhanced unemployment coverage for workers by allowing them to use their most recent earnings to qualify for benefits, even if they were only working part-time.

"In an economic downturn, many people become under-employed before they finally lose their job. It is a shame to see people denied benefits because they were cut back to part-time status before they were ultimately laid off," Oberstar said.

Oberstar added that economists have shown that unemployment benefits have a stimulative effect on the economy. "People use these benefits to buy gas, groceries, pay mortgages and educate their children. Those are the activities that keep us from sliding into a deeper recession."

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