Expiration Of Federal Unemployment And Pandemic Benefits
As of September 5, 2021, several federal unemployment benefit programs have expired across the country, per federal law. The federal benefit programs that have expired include:
- Pandemic Unemployment Assistance
- Pandemic Emergency Unemployment Compensation
- Extended Benefits
- $300 Federal Pandemic Unemployment Compensation
- $100 Mixed Earner Unemployment Compensation
Unemployment Insurance benefits will continue to be paid to eligible claimants. To be considered eligible for UI after September 5, 2021, a claimant must be unemployed AND be in the first 26 weeks of benefits. Claimants can find their effective days remaining in their online Payment History. Because FPUC has expired, any weeks a claimant is eligible to receive UI benefits after September 5, 2021 will no longer include the additional $300 in FPUC.
What’s Next For States As Enhanced Unemployment Benefits Are Set To End
As the country heads into the Labor Day weekend, millions of Americans will be losing the enhanced and pandemic-related unemployment benefits that have helped keep them afloat for the better part of the coronavirus pandemic.
The Biden administration has said ending the federal programs at this time is appropriate, but it also indicated states can use recovery funds to help those who are still struggling with unemployment. To date, no state has elected to do so.
An estimated 7.5 million workers will lose all of their unemployment benefits, come September 6, according to the Century Foundation. That’s the largest drop-off in unemployment benefits in history. It comes as coronavirus cases and hospitalizations are surging due to the Delta variant.
CBS News reached out to officials in all 50 states to see if they would be extending the enhanced $300 benefits or other programs, such as the ones created for those who don’t qualify for traditional unemployment benefits — like gig workers, self-employed workers or those who’ve been out of a job for a long time. The vast majority acknowledge states will return to pre-pandemic unemployment benefit levels starting next week. One state official even said for enhanced benefits to continue, they would need to see congressional action.
The paper went so far to suggest the decreases in consumer spending with the early end of benefits may have had a harmful impact on employment with increased layoffs and reduced hiring.
The Status Of Us Jobs
- More Workers Quit Than Ever: A record number of Americans more than 4.5 million people voluntarily left their jobs in November.
- Jobs Report: The American economy added 210,000 jobs in November, a slowdown from the prior month.
- Analysis: The number of new jobs added in November was below expectations, but the report shows that the economy is on the right track.
- Jobless Claims Plunge: Initial unemployment claims for the week ending Nov. 20 fell to 199,000, their lowest point since 1969.
All those programs are set to expire next month unless Congress extends them, which appears unlikely. President Biden on Thursday encouraged states with high unemployment rates to use separate federal funds to continue the programs, but it is unclear how many will.
Advocates for the unemployed say they are worried about what will happen to workers if they lose their benefits, especially as the more contagious Delta variant of the coronavirus spreads nationwide.
Were putting people in this situation at the worst possible time, where they have to be stressed about their children and their safety and now they have to be stressed about their finances, said Rebecca Dixon, executive director of the National Employment Law Project.
Recent evidence suggests that if the benefits do end, most jobless workers wont immediately find jobs, despite a record number of available positions.
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States Which Ended Additional Federal Jobless Benefits Early Didn’t See Workforce Increase
Three months after states began ending $300-a-week unemployment checks, the workforce has not risen more than it has in the states that continued to give out the federal payments.
The federal unemployment program ended nationwide on September 6, but the country’s workforce was reduced that same month, despite many hopes and predictions that many could seek to join the workforce once funds were cut off.
According to a state-by-state data analysis by the Associated Press, workforces in the states that maintained the unemployment payments grew slightly more than the workforces in the states that cut off the payments earlier.
“Policymakers were pinning too many hopes on ending unemployment insurance as a labor market boost. The work disincentive effects were clearly small,” said Fiona Greig, managing director of the JPMorgan Chase Institute.
Economists did not predict the labor shortages would last this long and believe factors such as fear of COVID-19 and lack of child care as possibilities convincing millions to not return to work.
There is a near-record number of available jobs in the U.S. and the economy has 5 million fewer jobs than it did before the pandemic, although job growth slowed in August and September. For most Americans, the $300-a-week federal check in addition to regular state jobless aid meant that many of the unemployed received more in benefits than they earned at their old jobs.
For more reporting from the Associated Press, see below.
The $300 Boost Really Is Not The Big Part Of The Story Here
Twenty-six states cut off the extra $300 in weekly benefits this summer before the federal expiration, while 22 also canceled the Pandemic Unemployment Assistance and Pandemic Emergency Unemployment Compensation programs. Many of those governors blamed the unemployment programs, specifically the extra $300 of weekly benefits, for labor shortages.
But the early cancellation of the $300 boost didnt lead to much of the job gains in those states.
Most of the unemployed workers who found jobs were on PUA the program for workers like contractors and freelancers who dont normally qualify for regular unemployment insurance and PEUC the program that provides extra weeks of benefits.
The $300 boost really is not the big part of the story here, Dube said. Ending PEUC and PUA is really the bigger part.
Nationwide, those three federal unemployment programs are set to expire on September 6.
Based on the analysis of the early cutoff in the 19 states, the researchers suggested that the federal expiration could lead to a half million new jobs in September and October combined, while the majority of the 4 million workers losing benefits would take even longer to find jobs.
The paper also estimates an $8 billion drop in spending during September and October.
This week, the Biden administration called for states with high unemployment to use leftover stimulus funds to extend some of the pandemic-era unemployment programs that are set to expire in early September.
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Less Income Less Spending
Average impact of ending federal programs on weekly unemployment benefits, earnings and spending, among people who were on unemployment in late April.
Notes: Data is as of Aug. 6 and includes 19 states that have cut off benefits.
The labor market didnt pop after you kicked these people off, said Michael Stepner, a University of Toronto economist who was another of the studys authors. Most of these people are not finding jobs, and its going to take them a long time to get their earnings back.
The Labor Department data that was released Friday told a similar story. The five states experiencing the fastest job growth in July Vermont, Hawaii, North Carolina, Rhode Island and Alaska have all retained at least some of the federal benefits.
Overall, states that have ended some or all of the benefits have experienced slightly slower job growth since April than states that have continued the benefits, although economists cautioned that the data was volatile and that the benefits were only one of many ways that the states differed from one another.
Further complicating the picture, states cut off different sets of benefits at different times, and in several states court challenges delayed or are continuing to delay the end of the programs. Still, the data suggests that ending the benefits has not led to a surge in job growth.
Coral Murphy Marcos contributed reporting.
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The governors of 26 states have announced their intention to prematurely withdraw from the additional unemployment benefits funded by the federal government. The American Rescue Plan had extended the $300 weekly supplement until September.
Before this month 22 of the 26 states have already pulled out of the programme, with another three to do so in July. Residents of and Tennessee will have lost their additional benefits from 3 July, while the extra support will end for Arizonans on 10 July.
As it stands, the last state to voluntarily pull out of the programme will be Louisiana, which will officially end the additional unemployment benefits on 3 August.
Missouri became one of the first states to end federal pandemic unemployment benefits. But there has been virtually no uptick in job applicants, officials say, as many looking for work hold out for better wages.
The New York Times
States face court challenges for denying residents federal jobless support
The states to opt out of the additional benefits did so without consulting residents and are now facing several legal challenges regarding their authority to deny people access to a federally funded programme.
Indiana Legal Services and Macey Swanson Hicks & Sauer, a private law firm specialising in employment issues, have argued that denying access to the additional payments would violate an Indiana law which requires the state to procure all available federal insurance benefits to citizens.
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Who Can Still Apply For Unemployment
While pandemic unemployment has ended, regular unemployment is still available.
Each state sets its own guidelines on how it issues unemployment insurance. In many cases, unemployment is available to salaried workers that lose their jobs through no fault of their own.
Applicants must meet work and wage requirements and there is a limit for how many weeks can be claimed.
Federal Benefits Ended Sept 4 2021
The week ending Sept. 4, 2021, was the last payable week for the following federal pandemic unemployment benefit programs:
- Pandemic Emergency Unemployment Compensation : Federal extension to state unemployment benefits for people who have exhausted state unemployment insurance benefits.
- Pandemic Unemployment Assistance : Federal benefits for the self-employed or people who are otherwise ineligible for state unemployment insurance benefits and extensions, and who unable to work as a direct result of COVID-19 each week.
- Federal Pandemic Unemployment Compensation : Supplemental $300 weekly benefit paid in addition to a claimants state benefits, PEUC or PUA.
- Mixed Earners Unemployment Compensation : Additional $100 a week for claimants receiving state benefits or PEUC who also meet requirements for self-employment income.
Benefits that are owed to claimants for any weeks ending before Sept. 4 will be paid retroactively.
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More Than Half Of States Have Ended Unemployment Benefits Early
It is still unclear what effect the termination of benefits will have on unemployment in these states. However, the decision to voluntarily end federal payments especially because it has been done without any form of compensation has also proved to be unpopular.
During the pandemic, the Trump administration approved a $300 per week boost in federal unemployment benefits, providing assistance to Americans between jobs and actively looking for work. These benefits were renewed under President Joe Bidens American Rescue Plan Act, approved in March 2021, and slated to extend until September 6.
These programs have been very popular among the unemployed. Collected non-stop, they amount to an annual payment of around $15,000 per year, enough to put an American adult above the poverty line in many U.S. states. In practice, many states require recipients of unemployment benefits to perform a certain number of employment-related activities per week to claim the benefits, and government agencies have made it clear that the benefits are not intended as an alternative to work, but a safety net.
Trevor Filseth is a current and foreign affairs writer at The National Interest.
There Are Too Many Ways To Lose Unemployment Compensation
At the onset of the COVID-19 pandemic, existing unemployment insurance programs were unable to meet the extraordinary demand from workers abruptly displaced from their jobs. Programs authorized by Congress extended and expanded access to UI. Pandemic Unemployment Assistance expanded access to UI benefits for up to 39 weeks for those not eligible for regular UI . Pandemic Emergency Unemployment Compensation extended the number of weeks of benefits that are available to regular UI recipients. Unemployment compensation programs support families who have lost employment, helping them to weather the economic crisis while promoting consumer spending more broadly.
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The Wrong States Are Ending Unemployment Insurance
As part of the pandemic response in March 2020, the United States enhanced and extended unemployment insurance through the CARES Act by adding $600 a week to the regular state unemployment benefit through July 6th, 2020. As part of the American Rescue Plan Act, federal policymakers extended eligibility for UI and approved an option for states to allow an additional $300 a week through September 6th, 2021.
Many state governors chose to withdraw from the federal program, ending the additional support to the unemployed in their states, even before the federal program ended. A withdrawal from the program decreases payments by $300 weekly and reintroduces limits on eligibility .The enhanced unemployment insurance should end at some point, as it was always supposed to be a stop-gap solution for the pandemic and not a permanent policy. And while policymakers should take steps to reform unemployment insurance so that it is responsive to similar events in the future, the pandemic enhancements were drawn up in an emergency context and are unlikely to represent the best policy design in the long run. As such, we should not be surprised to see governors withdraw from the UI enhancements as vaccination rates rise, and states turn their focus to the economic recovery.
The exact opposite has occurred, however. The states that are ending the enhancements to unemployment insurance are the very states that have, to date, vaccinated the fewest people.
Why Did Benefits End Early In So Many States
Citing labor shortages in the spring, 26 state governors claimed pandemic-related unemployment benefits were producing limited incentives for workers to take jobs. Many economists and analysts disagreed, highlighting several factors that prevented people from finding suitable work, including low wages, lack of health care, inadequate child care and fear of contracting COVID-19.
With unemployment claims still fluctuating as the economy struggles to return to pre-pandemic “normalcy,” reports are showing that the early cancellation of the federal programs had little impact on labor markets. A recent JP Morgan Chase Institute study confirmed that states that ended supplemental unemployment insurance programs during the summer saw a limited impact on job growth.
According to an August report by the Century Foundation’s Andrew Stettner, “Politics, not economics, drove the attack on unemployment insurance.” The states that cut off the enhanced benefits before the federal expiration were mostly Republican-led.
Arkansas, Indiana and Maryland were slated to cut off benefits early, but successful lawsuits forced those states to preserve the federal coverage, at least temporarily. In issuing their rulings, judges noted that the ending of benefits made it harder for the unemployed to afford basic needs. Lawsuits were also filed against state governors elsewhere, which were either denied by judges or are still held up in the courts.
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Eliminating Federal Unemployment Benefits Has Promoted Economic Expansion
The unemployment rate fell to 4.6 percent in October, reflecting the strong economic expansion that began in April 2020. This decline also reflects the early ending of federal unemployment compensation programs over the summer in 22 states, and in all remaining states in early September. By October, the unemployment rate was nearly back to the natural rate of 4.5 percent, according to the Congressional Budget Office .
Labor market developments for the unemployed support the view of an imminent return to high-employment conditions, aided by the end of pandemic-related unemployment benefits. The initial unemployment compensation claims report for Nov. 10 shows that initial claims not seasonally adjusted fell to 241,718 in the week ending Oct. 30, lower than the 251,851 registered for the week ending March 14, 2020, just before the economy began to reflect the pandemics effects, especially on employment. NSA data the actual numbers observed for the economy are used because the pandemic/recession effects on economic measures were unprecedented one-time events proper seasonal adjustments are not possible. This was the second week in a row that continuing claims were lower than before the pandemic hit unemployment.
Possible Legislation On The Way
Some lawmakers and advocates have argued that the Department of Labor is obligated to continue paying out PUA, including Sen. Bernie Sanders.
But the Labor Department has concluded that there’s likely not much it can do, and the White House has said that states have “every right” to cut off aid in a sharp change of course after defending benefits a month ago.
Some Democrats are eyeing revamping the dilapidated systems as part of Biden’s multitrillion-dollar infrastructure package.
“We ought to cut to the bottom line here,” Wyden said in an interview. “This highlights the need for a comprehensive unemployment reform package.”
“I talk to the administration about these unemployment reforms constantly,” he added. He previously suggested he wanted to draft a legislative fix but did not specify if he was still pursuing that measure.
Some are already taking legal action. In Indiana, two law firms have filed a lawsuit against the state for prematurely terminating benefits and have asked for a preliminary injunction to pause benefits being halted as the case progresses.
But in Alabama, there’s no relief on the way.
“I’m still just screwed, basically,” Cruz said. “Like I literally have no idea where my family is going. I’m trying to get enough money to rent a storage unit right now just to put all my stuff in.”
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