V.I. unemployment climbs above 7%
Published: June 28, 2013
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ST. THOMAS - The V.I. Labor Department announced that a seasonal drop in the number of available jobs has triggered eligibility for another of 23 weeks of extended unemployment benefits starting next week.
The eligibility for extended unemployment benefits is analyzed on a rolling basis by the U.S. Labor Department using factors such as the number of employers within a state or territory and the number of initial unemployment claims filed within a 13-week period. Last week, the total unemployment rate rose above 7 percent, the threshold for triggering eligibility for Tiers 1 and 2 of extended benefits, according to V.I. Labor Commissioner Albert Bryan Jr.
The national unemployment rate for May was 7.6 percent, according to U.S. Labor Department statistics.
The V.I. Labor Department holds that the unemployment rate for the Virgin Islands for the month of May was 13.2 percent, the same as that calculated for April. On St. Thomas, the rate was 11.7 percent, and on St. Croix, the rate was 15 percent, actually down about 2 percentage points since March. That decrease was because of fewer people filing initial claims, not to an increase in the number of hires on the island, though, Bryan said.
Eligibility for tiers of extended benefits is evaluated by the U.S. Labor Department every month using numbers based on the previous three months, Bryan said.
Bryan said more than 1,000 people who may have exhausted Tiers 1 or 2 of extended benefits may be able to collect longer because of the new eligibility status.
Extended unemployment benefits begin after 26 weeks of regular unemployment benefits have been exhausted. Tier 1 lasts 20 weeks; Tier 2 offers 14 another 14 weeks; and Tier 3 offers an additional nine weeks beyond that.
In late February, the territory lost eligibility for Tier 4 benefits, the last available six-week period of extended unemployment benefits, because the federal government calculated the local unemployment rate to be below 9 percent, which Bryan said was because of tourist season jobs being filled.
The Virgin Islands typically dips below thresholds for extended unemployment benefits about the beginning of the year because many of the temporary tourism industry jobs have been filled. However, by the start of the summer, those jobs drive up new claims numbers, allowing the Virgin Islands to extend unemployment benefits beyond Tier 1, Bryan said.
Bryan said it is possible that unemployment numbers could go up another 1 or 2 percentage points, triggering eligibility for the final tier of benefits, Tier 4. However, Bryan also said there is a strong possibility that the entire extended unemployment benefits package could be withdrawn for 2014 if Congress does not reauthorize them.
Once a recipient begins a tier of benefits, it cannot be withdrawn even if the territory's unemployment rate dips back below the threshold. The threshold applies to new applicants only.
Still, Bryan cautioned those on unemployment benefits from making long-term plans based on the availability of benefits. Once regular benefits have been exhausted, extended benefits are unpredictable.
"People think it is a guaranteed check, but there are no guarantees. We could always trigger back off," Bryan said. "I don't want job seekers to have a false sense of security or to get complacent in their job search."
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