September 27, 2020

$400 Unemployment Stimulus Is Really $300, and Won’t Arrive Soon

But unlike the earlier supplement, which was fully funded by the federal government, the program called for states to chip in a quarter of the cost. Governors from both major parties balked at being asked to spend billions of dollars when tax revenues have plunged because of the economic collapse.

So this week the administration offered new guidance: Rather than adding $100 a week on top of existing unemployment benefits, states could count existing benefits toward their share. In other words, unemployed workers would get an extra $300, not $400.

States still have the option of providing an extra $100, but few if any are expected to do so.

“They’re stretched,” said Andrew Stettner, a senior fellow at the Century Foundation who has been studying the unemployment system. “They don’t have money for masks for the teachers in their schools. They’re probably not going to come up with an extra $100 for everyone on unemployment insurance.”

Under guidance released by the Labor Department on Wednesday evening, the new program will be available to people who certify that they are “unemployed or partially unemployed due to disruptions caused by Covid-19” — but only if they already qualify for at least $100 a week in unemployment benefits.

That provision would exclude roughly one million people, nearly three-quarters of them women, according to Eliza Forsythe, an economist at the University of Illinois.

“They’re the people who need it the most,” Ms. Forsythe said. “They were low paid to begin with, and then being singled out for not getting this benefit I think is really cruel.”

It isn’t clear why the $100 minimum was established. Mr. Trump established the benefit under a federal disaster program that requires states to cover 25 percent of any costs. But that rule applies to the overall program, not to individual recipients. People receiving money under the Pandemic Unemployment Assistance program, for example, qualify for the $300 a week even though that program is entirely funded by the federal government.

Article source: https://www.nytimes.com/2020/08/13/business/economy/unemployment-benefits-coronavirus.html

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