For many unemployed Americans, an additional $ 600 per week in federal unemployment insurance provides stability during an unstable economic period. But how long does the benefit last?
When the coronavirus pandemic first flared in mid-March, causing the domino effect of an immediate event cancellation and business closure, spending disappeared almost overnight. In a quick step to flush cash through the economy, the federal government approves $ 2-trillion Coronavirus Assistance, Assistance, and Economic Safety Act.
Among other things, the CARES Act meets ordinary state unemployment insurance – which can vary from as low as $ 213 per week in Alabama to $ 555 in Massachusetts (national average is $ 378) – an additional $ 600 per week.
The benefits will end July 31. But with the pandemic still strong, MPs are debating what will happen next. These are some of the several proposals on the table.
In early May, a group of Democratic legislators proposed extending the benefits of $ 600 per week past July 31 and then removing them once the economy stabilized.
Worker Assistance and Safety Act, introduced by Rep. Don Beyer (D-Va.) And Sens. Jack Reed (DR.I.) and Michael Bennet (D-Colo.), Will extend benefits of $ 600 per week for 30 days after the president’s emergency declaration. Then they propose the gradual abolition of funding, with changes triggered by each country’s unemployment rate. Countries with the highest unemployment rates will receive $ 450 per week to start, and then will drop to $ 300. Countries with lower unemployment rates will start with a weekly compensation of $ 350, which will drop to $ 200.
Eligibility for funding will also be extended by several weeks. Cutting additional benefits at the end of July would be “a human and economic disaster,” Beyer wrote a statement.
“If you [unemployed] in a state with a [lower] unemployment rate, it is frustrating because your benefits are reduced. But you won the lottery because you were more likely to get a job back, “he explained Alix Gould-Werth, Washington director for equitable family economic growth policies.
Another proposal came a month ago, when Democrat House released the $ 3 trillion HEROES Act, which would extend unemployment benefits to January, among other stimulus proposals. But the Republican Party, which holds a majority in the Senate, quickly dropped the law as a progressive “wish list”.
As recently as last month, many Republicans, including President Trump, balking at extending benefits last July. But given the millions of unemployed Americans, many Republican lawmakers have now recognized the need for ongoing assistance.
“With the unemployment rate so high and with a recession that will last until next year, it is very important to maintain generous unemployment insurance, because it helps workers, it helps businesses because workers spend their money on business, and helps the community,” said Peter Ganong, assistant professor at Harris School of Public Policy at the University of Chicago.
Hill reports that several Republicans are starting to merge around the Sen. solution. Rob Portman (R-Ohio): bonus back to work $ 450 per week. Someone who returns to work will receive $ 450 per week for six weeks, above the regular wage. Coupled with federal minimum wages, Portman estimates, a $ 450 weekly bonus will make returning to work more attractive than continuing unemployment insurance. The federal government will save by cutting spending by $ 600 per week down by $ 150, the state will save unemployment and workers will benefit from incentives, Portman said.
“That means that you will make a little more in the workforce than in unemployment,” Portman said on the floor of the Senate. “What’s more, the bonus of returning to this job will put additional money in the hands of people who have lost their jobs due to the health crisis, which should provide additional stimulus to the economy which has experienced a historical decline in consumer spending.”
Some lawmakers worry that people make more money for unemployment than they do in their pre-pandemic work, preventing employers from getting their workers back. A Congressional Budget Office Report shows that if the $ 600 per week allowance continues through January, around five out of six recipients will receive more money from weekly benefits than those who will work during those months. The number of jobs will be lower until next year too, he said.
However, with high unemployment rates, Gould-Werth said, the problem is not getting people out of unemployment to return to work.
“People will really go back to work with $ 600 in benefits,” he said. “It’s very simple – we just don’t have enough work for workers to return.”
Paycheck Security Act, proposed by Sens. Bernie Sanders (D-Vt.), Mark Warner (D-Va.), Doug Jones (D-Ala.) And Richard Blumenthal (D-Conn.), Will try to overcome that problem by funding small businesses to re-employ workers who are dismissed or dismissed and cover their health benefits. Proposal, which garnered support Senator Dianne Feinstein (D-Calif.), Will provide a tax credit that can be returned to eligible small businesses up to $ 90,000 per employee per year, according to a news release.
Negotiations for future unemployment benefits are likely to heat up in the coming weeks. You can find your representatives and senators in Congress to provide feedback here.
