About 12 million unemployed workers were on their way to lose their unemployment benefits on December 26, as two had expired pandemic crisis programs. But Monday came a lifeline when Congress approved a $ 900 billion stimulus package that would expand those programs, as well as add $ 300 in additional weekly unemployed wages.
Now the timing of that lifeline is in the air for a number of reasons, including President Donald Trump’s last minute question for changes in the invoice.
While Mr Trump expressed grievances on several issues in the bill on Tuesday night, his more targeted complaints were directed at the $ 600 direct incentive payments, which he called “ridiculously low”. Mr. Trump also commented on one tax credit for business meals, which he said should be extended beyond the two years stipulated in the bill.
However, Mr Trump did not address the issue of unemployment assistance. The stimulus bill would extend two major pandemic programs by 11 weeks and supplement regular government benefits with an additional $ 300 in weekly unemployed aid. While the new round of aid will no doubt provide welcome relief, it is only half of the additional $ 600 in aid that unemployed workers received at the start of the pandemic and ended in July. At the same time is the number of people applying for unemployed help remains at a high level, showing that the coronavirus continues to take its toll on the economy.
“A lot of workers are concerned because they have gone into the hole while unemployed; they have accumulated debt,” said Andrew Stettner, an unemployment expert at the left-wing Century Foundation. “Part of the research shows that the average unemployed person has negative net worth.”
The extra $ 300 a week, as well as extra weeks of unemployment, probably won’t be enough for many unemployed workers to dig themselves out of debt, Stettner added, but would likely help many meet their basic needs – at least until the programs expire. mid-March.
Kenneth Elliott, a 50-year-old driver in West Palm Beach, Florida, has been out of work since March. Between April and July, he could qualify for $ 600 a week in additional benefits that covered his expenses. But as of August, he has been living on just $ 275 a week in state unemployment benefits, “which is actually impossible to survive,” he recently told MoneyWatch.
Several months ago, Elliott gave up his own apartment and moved in with a friend to try to save on housing costs, he told CBS MoneyWatch. But the $ 275 still doesn’t cover all of his expenses, including health insurance, auto insurance, and his phone bill, so he was behind on rent.
“I’ve been lucky enough to have a very understanding landlord willing to work with me, but I don’t know how far that will go,” said Elliott. “I’m going to the wire.”
Wait a month?
Democrats are here now try to change the stimulus bill, at Mr. Trump’s urging, to ramp up stimulus checks to $ 2,000 per person, out of the $ 600 currently in the legal text. That effort will slow down the stimulus package, meaning unemployed Americans will wait longer for that extra $ 300 in weekly unemployment assistance.
But even before Mr. Trump raised his objection, it was likely that many states would have taken as much as three to four weeks to pay out the extra $ 300 in weekly benefits, Stettner said. Those benefits would stem from the Federal Pandemic Unemployment Compensation (FPUC) program, which was created in March by the Coronavirus Aid, Relief and Economic Security (CARES) law but expired in July. To get those $ 300 payments, states would have to get that program back on track after a long time.
Unemployment programs are run independently by each state and unemployed workers apply for help through their national labor departments. Depending on the efficiency of their state’s computer systems and workforce, unemployed workers may experience very different waiting times to receive benefits. Some states can send the $ 300 in FPUC benefits quickly, but others may see longer delays.
For example, according to the Century Foundation, 8 out of 10 unemployed workers in Wyoming receive their unemployment benefit within 14 days of becoming eligible for the benefit. But only 2 in 10 unemployed people in Kentucky receive their first payment within two weeks.
Difference in benefits
The slowdown in the incentive law could also create a gap in the current benefits paid to unemployed workers.
About 12 million people receive unemployment benefits through two programs ending December 26: the Pandemic Unemployment Assistance (PUA) program, which covers gig workers and the self-employed, and the Pandemic Emergency Unemployment Compensation (PEUC) program, which provides extra weeks of unemployment. aid to those who run out of regular unemployment benefits.
The stimulus bill passed by Congress on Monday was designed to avoid a benefit cliff for unemployed workers, currently in those programs, by extending those programs until March 14. weekly.
“It’s pretty certain that there will now be a delay for people” participating in these soon-expiring programs, Stettner said. “At best they miss a week full of benefits.”
However, the benefits would be paid retroactively once a bill is signed by Mr. Trump. Unemployed workers should continue to apply for their benefits, even if there is a gap to ensure they receive back wages, Stettner noted.
“It will affect people, so it’s important to pass this on,” Stettner added. “People will blame the states because that’s who they know, but that’s a misplaced debt. Congress took forever, and now the president is delaying it even further.”