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Unemployment aid: What’s at stake for US economy

More than a million Americans lost their unemployment benefits late last month, when a temporary federal program expired. Congress is debating whether to restore the aid for three more months.

A bill to do so cleared a key procedural hurdle in the Senate on Tuesday. But final passage remains unclear. Democrats say extending the aid would boost hiring and economic growth. But many Republicans say the benefits discourage the unemployed from seeking work and would widen the federal budget gap.

(Read more: Senate votes to extend unemployment benefits for 1.3 million Americans)

Some questions and answers about what's at stake for the U.S. economy:

Kirby Hamilton | E+ | Getty Images

Q. Who's affected?

A. Nearly 1.4 million Americans who have been unemployed for more than six months. No longer can people continue to receive checks longer than that. Hundreds of thousands of others will lose their benefits in coming weeks, when they, too, will max out on the six months of unemployment benefits that most states provide.

Q. What did the expired program provide?

A. Starting at the end of 2008, it gave unemployment payments to people who had exhausted their state benefits. In some cases, people were able to collect aid for nearly two years.

Q. Why have some Americans needed benefits for so long?

A. Mainly because the job market has remained weak even though the Great Recession officially ended more than 4 1/2 years ago. Many Americans have been unemployed for well beyond six months. More than 5 million jobs were shed in 2009 alone. The national unemployment rate has dropped from a peak of 10 percent to 7 percent. But of the 10.3 million people who are still unemployed, nearly half have been without a job for more than six months, according to the Labor Department.

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