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Federal subsidy for jobs has run out

on September 30, 2010

Tonight at midnight the federal money subsidizing salaries for more than 1,000 workers in Contra Costa County expires, and employers have to decide today whether to lay off those workers or pay the wages themselves.

Congress adjourned early today without funding the emergency jobs program that in the past year has subsidized 1,081 jobs in Contra Costa County and 35,000 jobs statewide. The $5 billion federal fund was part of last year’s stimulus bill. The money went to states to help get citizens off welfare and working again.

“It’s a huge loss,” said Karen Mitchoff, spokeswoman for the Contra Costa County Employment and Human Services Department. The federal money paid 100 percent of the salary when employers hired a person who had been without a job. Mitchoff said workers across the county made an estimated $5 million in wages through the program. Public agencies, non-profit organizations, and businesses benefited from having more employees.

The jobs also stimulated the local economy, Mitchoff said, citing statistics showing that for every dollar someone made, approximately $1.32 was spent in the community. “I call it exponential spinoff,” she said.

A survey of workers hired under the program found 99 percent of them were satisfied with their work and their supervisors, according to Gerald Dunbar, the coordinator for the county’s subsidized employment program.

In Contra Costa County, where unemployment stands at 11 percent, the loss of these federally subsidized jobs will mean more people back on welfare, Dunbar said. He estimates that some 600 county residents could be losing their jobs after today.

The loss of funding could be especially detrimental in Richmond, which has an unemployment rate of 18.5 percent, one of the highest in California.

Dunbar said he isn’t hopeful about the job market in the county. “I see continuing in a rather bleak circumstance,” he said.

Dunbar and Mitchoff both said they don’t yet have a count of how many employers will hire the subsidized workers for permanent positions.

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