Get ready for Stimulus Part 2.

Against a backdrop of deteriorating jobs, administration officials and policy makers are weighing further action intended to prop up the labor market and expand some federal safety nets.

Despite some signs that the economy is beginning to recover, most economists agree that the labor market will worsen before it improves. In September, the unemployment rate rose to 9.8%, according to a Labor Department report -- one that President Obama called a sobering reminder that progress comes in fits and starts. Moody s Economy.com, which provides economic analysis, expects more near-term fits forecasting the unemployment rate will reach 10.1% by mid-2010.

The jobs outlook is part of a broader economic picture giving policy makers more ammunition to act again. And although the administration has balked at calling any new measures part of a new stimulus package, these moves will require fresh legislation and more money.

Whatever combination of things they re doing won t be near the $787 billion price tag of the February stimulus, says Nigel Gault, chief U.S. economist at IHS Global Insight. But there will be a number of piecemeal measures. (A White House spokesman says the president and his economic team are only in preliminary discussions regarding proposals to boost the economy and create jobs.)

Here s what s on the table.

Unemployment benefits

Current program: Workers get 79 weeks of unemployment benefits; expires Dec. 31, 2009.

The House approved legislation in September to provide 13 additional weeks of unemployment benefits to states with jobless rates of 8.5% or higher (currently 28 states). Meanwhile, Democrats in the Senate are pushing a similar measure that would give workers in all states these additional weeks of benefits.

With long-term unemployment on the rise, it s very likely that unemployment insurance benefits will be extended again, says Jim Horney, director of federal fiscal policy at the Center on Budget and Policy Priorities (CBPP), a left-leaning research group. You have people in a number of hard-hit states who are going to run out of benefits. When they hit that limit, that ll be it despite the fact that their state has very high unemployment and the chance of finding a job is slim, he says.

Health insurance for laid-off workers

Current program: A 65% subsidy of Cobra health insurance premiums for workers laid off between Sept. 1, 2008 and Dec. 31, 2009; the subsidy lasts for up to nine months.

The stimulus that went into effect earlier this year included a provision in which the government pays 65% of the Cobra premium for up to nine months for workers who are involuntarily let go. In the past, laid-off workers who wanted to continue their employer-sponsored coverage had to pay the entire premium plus a 2% administrative fee. Given the uptick in Cobra usage since the subsidy began in February enrollments have doubled as of August, according to a study by human resources firm Hewitt Associates an extension will likely pass.

Under the subsidy, the cost of maintaining the average policy would be $377 per month for a family and $140 for an individual, according to a report by the Kaiser Family Foundation, a health policy nonprofit. Once the subsidy expires, that cost would rise to $1,078 per month for family coverage and $400 a month for individuals.

Current program: Tax credit of up to $8,000 for first-time home buyers; expires Nov. 30, 2009.

Extending this financial incentive for home buyers is not as much of a sure thing as the unemployment safety-net programs. First-time buyers or those who haven t owned a home in the past three years are eligible for a tax credit of up to $8,000.

There s a strong chance that most of the people who would be induced by this credit would have done so already, says Gault. You d give most of the future benefit to people who would have bought a home with or without the credit, he says a move that would not necessarily stimulate the housing market.

Employer tax credit

(No program exists now.)

Obama s original stimulus package had included a tax credit for employers that hire new workers, but the credit didn t make the final cut. Such a credit would give employers a tax break if they increase their payrolls a policy designed to get companies over their reluctance to start hiring again.

Critics of this plan say it could be difficult to implement. They also argue that the policy would end up giving money to firms that would hire new workers anyway.

The fact that a tax credit is up for debate again is a sign that Washington remains concerned about job creation over the next year. Is such a credit a critical feature of a jobs creation package? It s not at the top of my list, says Josh Bivens, an economist at the Economic Policy Institute, a think tank. But I could see it going either way, he says.

Not on the table: More fiscal relief for states

Expires Dec. 31, 2010

The stimulus package that passed in February provided states with $140 billion to help close gaping budget holes; of that, $87 billion went toward a temporary increase in the share of Medicaid that the government would pay. That assistance is effective through Dec. 31, 2010. As of now, no legislation to send more aid has been introduced in Congress.

It s surprising that this was not the No. 1 priority, says Bivens. (States' combined budget gaps for the next two fiscal years are estimated to reach at least $350 billion, according to the CBPP.) The funding from the original stimulus likely staved off more significant cuts, but many states have already implemented those cuts while balancing their budgets for fiscal year 2010. Leading up to July, state legislatures will be developing their budgets for the following year.

With deficits expected, governors have to know if they ll get a continuation of federal assistance, says the CBPP s Horney. Without more aid from the government, many states that are still struggling may be forced to reduce their staffs, and the layoffs could filter down to the private labor force.