About 12 million unemployed workers were on the verge of losing their unemployment benefits on December 26 due to the expiration of two pandemic crisis programs. But a lifeline came Monday when Congress passed a $ 900 billion stimulus package that would expand those programs, and add an extra $ 300 a week to the unemployed.
Now the timeline of this lifeline is in the air for several reasons, including that of President Donald Trump last minute request for invoice changes.
While Mr. Trump on Tuesday night expressed dissatisfaction with several aspects of the bill, his clearer complaints were directed at $ 600 direct incentive payments, which he called “ridiculously low.” Mr. Trump also commented on a tax exemption for business meals, which he said should be extended for more than two years under the bill.
However, Mr. Trump did not address the issue of unemployment benefits. The stimulus bill will extend two major pandemic programs for 11 weeks, as well as supplement regular state benefits with an additional $ 300 in weekly unemployment benefits. While the new round of aid will no doubt provide a welcome relief, it is only half of the additional $ 600 in aid received by unemployed workers at the beginning of the pandemic and which expired in July. At the same time, the number of people applying for unemployment benefits remains at a high level, showing that coronavirus continues to affect the economy.
“A lot of workers are worried because they went into the pit during unemployment; they’ve accumulated debt,” said Andrew Stettner, a left-wing Century Foundation unemployment expert. “Some research shows that the average unemployed person has a negative net value.”
The extra $ 300 a week, as well as the extra weeks of unemployment, will probably not be enough for many unemployed workers to get out of debt, Stettner added, but it would probably help many to satisfy themselves. basic needs – at least until the expiration of the programs in mid-March.
Kenneth Elliott, a 50-year-old driver from West Palm Beach, Florida, has not worked since March. Between April and July, he managed to qualify for $ 600 a week in additional benefits, which covered his expenses. But since August, he has been living on just $ 275 a week on state unemployment benefits, “which is almost impossible to survive,” he told MoneyWatch recently.
A few 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, which include health insurance, car insurance and his phone bill, so he found himself left behind on rent.
“I was lucky to have a very understanding owner who is trying to work with me, but I don’t know how far it will go,” Elliott said. – I’m going to the wire.
A month of waiting?
Democrats are now trying to change the incentive bill, following Mr. Trump’s urge to raise stimulus controls to $ 2,000 per person, from $ 600 currently in the legislation. This effort will delay the stimulus package, which means that unemployed Americans may have to wait longer for that additional $ 300 in weekly unemployment benefits.
But even before Mr. Trump objected, it was likely that many states would ask for up to three to four weeks to start paying an additional $ 300 in weekly benefits, Stettner said. These benefits would come from the federal pandemic unemployment compensation program (FPUC), which was created by the Coronavirus Aid, Relief, and Economic Security Act (CARES) in March, but expired in July. To get those $ 300 payments, states should first put that program into operation after a long time.
Unemployment programs are run independently by each state, and unemployed workers seek help through their state labor departments. Depending on the efficiency of the IT systems and staff in their state, unemployed workers may experience very different waiting times to receive benefits. Some states could quickly send FPUC benefits of $ 300, but others could see longer delays.
For example, 8 out of 10 unemployed workers in Wyoming receive their unemployment benefits within 14 days of being considered eligible for benefits, according to the Century Foundation. But only 2 out of 10 unemployed people in Kentucky receive their first payments within two weeks.
Gap in benefits
The delay in the incentive bill could also create a gap in the current benefits paid to unemployed workers.
Approximately 12 million receive unemployment benefits through two programs that will expire on 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 additional services for weeks. jobless aid for those who have exhausted their usual state unemployment benefits.
The stimulus bill passed by Congress on Monday aimed to prevent a rock of benefits for unemployed workers, who are currently in those programs, by extending those programs until March 14. The two programs currently pay regular state unemployment benefits, which average just over $ 300 a week.
“It’s pretty sure there will be a delay for people now,” who are in those programs that will expire soon, Stettner said. “At best, they will miss a week of benefits.”
However, the benefits would be paid retroactively after an invoice was signed by Mr. Trump. Stettner noted that unemployed workers should continue to claim benefits, even if there is a gap to make sure they get paid back.
“It’s going to have an impact on people, so it’s important that we do that,” Stettner added. .