The coronavirus relief program technically doesn’t expire until July 31, but next week will be the last week benefits are paid, because payments are only provided for weeks ending Saturday or Sunday.
Unemployed Americans will continue to receive state unemployment benefits, but the fall of the $ 600 congressional increase, part of the $ 2 trillion economic aid package approved in March, will leave more than 25 million people thousands of dollars poorer each month. . And it will expose more of the real pain of mass unemployment, just as many states are re-imposing closures.
“These emergency unemployment benefits have been underpinning families and underpinning the economy for several months,” said Kali Grant, senior policy analyst at the Georgetown Poverty and Inequality Center. “Ending benefits prematurely will really delay any economic recovery that may have been underway.”
The provision was controversial from the start, primarily because the $ 600 increase, when added to state benefits, is more than two-thirds of workers did on the job, according to an estimate by researchers at the University of Chicago.
But lawmakers approved it in late March as part of a historic expansion of the nation’s unemployment program at a time when health officials did not want people to look for work. The $ 600 fixed payment was much easier to implement for state agencies, which were already struggling as an avalanche of claims overwhelmed their outdated technology.
Senate Republicans, who are expected to publish their proposal this week, are generally reluctant to extend the full benefit. They feel that it creates a disincentive for people to return to work, a concern echoed by some business owners. Instead, Republican lawmakers are considering reducing the improvement by several hundred dollars and creating a bonus for those returning to work.
“The right thing for families and the economy is to extend supercharged unemployment benefits,” said Oregon Democrat Senator Ron Wyden. “They have undoubtedly kept the economy afloat.”
Blunt impact
The $ 600 payment provides more than $ 15 billion a week to 25 million Americans, according to an analysis by Andrew Stettner, a senior fellow at The Century Foundation. Many are using it to cover their rent or mortgage, buy food, and spend on other basic necessities.
Shanga McNair from Jacksonville, Florida is one of them. The veteran waitress lost her job at a brewery when the state closed earlier this spring, and then returned to work in early June at a jazz bar for about two shifts a week, below her typical six. However, state officials closed the bars again in late June, after coronavirus cases increased, sending her back to unemployment. Her parallel bartender jobs at private parties and banquets have also been sold out.
The $ 600 federal increase, in addition to his $ 275 weekly state benefit, is less than what he earned while working. She barely pays her rent, but it has allowed her to keep up with her bills. The 40-year-old woman, who also occasionally visits a local food pantry to supplement her grocery shopping, believes that if Congress does not extend the improvement, she has three months to find a job before being evicted.
Until now, he has had no luck. McNair has sent dozens of requests to restaurants, warehouses, customer service firms, and offices, but they haven’t yielded anything. He even filled out an application while taking a bite at Popeye’s after seeing the manager working multiple jobs, but was told there was a hiring freeze.
“I hate depending on the government, but everything is out of my control,” said McNair, who is sending two daughters to college and has never claimed unemployment before. She has written to her elected representatives in both parties. “You can’t just pull the rug because it’s not over.”
Eliminating the federal benefit will reduce workers’ weekly unemployment payments by 50% to 85%, depending on their state, Stettner said.
Furthermore, the increase in coronavirus cases has caused at least two dozen states to stop or reverse their reopening plans, which will also cost people their jobs. For example, California last week ordered the closing of restaurant bars, movie theaters, and dinners across the state, as well as the closing of gyms, houses of worship, shopping malls, beauty salons, and some offices in many counties.
The impact is already showing up in the data. The states with the largest increase in coronavirus cases earlier this month also had the largest increase in initial jobless claims, according to William Rodgers III, chief economist at the Heldrich Center for Workforce Development at Rutgers University .
Some economists fear that the fledgling job recovery will be derailed, sending even more people to the unemployment charts.
“Conditions in the labor market remain weak and the risk of increasing the loss of permanent jobs is high, especially if activity continues to be disrupted by repeated virus-related closings,” said Rubeela Farooqi, chief US economist at High Frequency Economics.
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