Georgia’s Labor Department reported Thursday that jobless claims in the state surged 81 percent in January over numbers for January 2007. The department’s numbers indicated that 120,139 people in the state filed for unemployement benefits.
Experts expect that the rise in jobless rates will result additional bankruptcy filings.
“Consumers are under great financial stress, with no immediate end in sight,” said Samuel J. Gerdano, American Bankruptcy Institute (ABI) executive director, in an article in the Dallas Morning News. “We expect the upward spike in personal bankruptcies to continue in 2009.”
According to the ABI, consumer bankrupcy filings rose 33 percent in 2008 over numbers from the previous year. A poll conducted by the ABI predicted that bankruptcy filings would jump at least 35 percent over the 1 million consumer bankruptcies filed in 2008.
If job losses continue to mount, the spike will likely be in Chapter 7 bankruptcy that will clear most unsecured debt. Without income to make payments on a Chapter 13 repayment plan, there is little chance that consumers in the Atlanta metro area would qualify.
