The extra $600 weekly unemployment benefits will end in July, but the possibility of an extension remains uncertain. What does it mean to the millions of Americans impacted by the coronavirus pandemic and are struggling to pay their rent?
The supplemental weekly unemployment benefits form part of the CARE Act that was passed in March and is set to expire by the end of July 2020. That is unless the U.S Senate does not pass the $3 trillion HEROES Act stimulus package to extend the $600-per-week unemployment benefit to January 2021.
The House of Representatives already passed the HEROES Act last May 15, a report said. The bill extends the extra $600 weekly benefits, along with other unemployment benefits under the stimulus package through January 2021. The unemployment benefits for the gig workers and contract workers are extended through March of next year.
As to whether the Senate will pass the HEROES Act as well remains uncertain. There are lawmakers, though, that see the additional unemployment benefits as a "disincentive" to return to work.
The extra $600-per-week unemployment benefits are being provided to help those who have lost their jobs due to the COVID-19 pandemic. These benefits are on top of what is provided by each state.
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In another report, it was stated that Senate Majority Leader Mitch McConnell vowed that unemployment benefits wouldn't be included in the next bill. Industry experts said that the question now is how many of the over 40 million unemployed workers return to work, and will they get the same wages to meet all their financial obligations, including rent if ever they did return to work.
Ohio Republican Senator Rob Portman instead proposes the use of federal funds as a return to work bonus. The return-to-work bonus will amount to $450 per week. Moreover, Representative Don Beyer (D-VA), suggests a gradual slashing of the $600 weekly extra unemployment benefit until the time it reaches $300, which is proposed to be by the end of 2020.
Such proposed measures might do little in helping those laid-off since the impact of the pandemic is farther reaching, that even white-collar industries are not safe. So legislators need to come up with some form of a rental voucher program to aid Americans in paying for their rent, Walker & Dunlop Chairman and CEO, Willy Walker, told Forbes.
If the extra $600 payment ceases, it could wreak havoc to the U.S. economy, National Employment Law Project senior policy analyst, Michele Evermore, told CNBC. This is because the spending power will significantly be impacted, which is terrible news, especially that many are still unemployed.
Job opening already hit an all-time low in March, which led to mass lay-offs, according to the Bureau of Labor Statistics monthly Job Openings and Labor Turnover report. And there seems to be little chance that the unemployment situation will turn around soon, which makes it unlikely that workers will choose to let go of their state-provided unemployment insurance program.
Losing the $600 weekly benefit will leave Americans with less money to spend, which can worsen the unemployment situation, Economic Policy Institute economist, Heidi Shierholz, said in the MarketWatch report.
