Two critical unemployment programs are set to expire at the end of the year, potentially leaving millions of Americans vulnerable to eviction and hunger and threatening to short-circuit an economic recovery that has already lost momentum.
As many as 13 million people are receiving payments under the programs, which Congress created last spring to expand and extend the regular unemployment system during the coronavirus pandemic. Leaders of both major parties have expressed support for renewing the programs in some form, but Congress has been unable to reach a deal to do so. It remains unclear how the results of last week’s election will affect prospects for an agreement.
The expanded unemployment programs are some of the last vestiges of the trillions of dollars in aid that Congress provided through a series of emergency measures in the spring. That spending — which included direct checks to most U.S. households, $600 a week in supplemental unemployment benefits and hundreds of billions of dollars in support for small businesses — offset the pandemic’s financial toll for many families, and helped fuel an economic recovery that was initially stronger than many forecasters expected.
Much of that assistance expired over the summer, however. Economic gains have slowed significantly since then, and studies have found that millions of Americans fell into poverty as aid dried up. Employment data released Friday showed that the number of people out of work for more than six months, the standard threshold for long-term unemployment, rose 1.2 million in October, to 3.6 million.
ImageA federal program that could extend benefits for some workers into next year isn’t available in Tennessee, where Randy Williams lost his job early in the pandemic.
A federal program that could extend benefits for some workers into next year isn’t available in Tennessee, where Randy Williams lost his job early in the pandemic.Credit…Andrea Morales for The New York Times
The year-end benefits cliff could be even more damaging. Many families have depleted any savings they built when the $600 supplement was available. A partial federal eviction moratorium is scheduled to expire at the end of the year, although it could be extended. And benefits checks won’t just shrink, as they did over the summer — they will disappear.
“The safety net still has kind of held up until now, and I think we have been maybe lulled into a sense of complacency,” said Andrew Stettner, an expert on unemployment benefits at the Century Foundation, a progressive policy research group. “We’re just putting people in this really precarious financial position where the damage of unemployment can just hit really hard.”
Nearly four million Americans are receiving benefits under the pandemic compensation program. That number has doubled in the past month and is expected to keep rising as more people reach the end of their state benefits, which last 26 weeks in most of the country.
If the program ends at the end of the year, some workers will be able to continue to receive benefits under a federal program not tied to the pandemic. But those benefits aren’t available in some states, including Tennessee, and don’t cover some types of workers, like freelancers.
The New York Times