Covid-19: Jobless Americans could lose a crucial $600-a-week lifeline

Policy makers are at a standstill in their talks for more stimulus, and whether to include an extension of the extra unemployment benefits

In about two weeks, millions of Americans could lose a crucial economic lifeline of this pandemic: $600 a week in extra federal unemployment benefits.

The scheduled end will ripple through households and the entire economy. The program accounts for a big chunk of the Treasury Department’s record jobless payments last month, which exceeded $100 billion. Without the additional cash, some of the hardest-hit households may be forced to choose which bills to pay and which to let slide.

For Amanda Steinhauser in New Jersey, it will mean burning through meagre savings even faster. For Chris Bolei in California, it means not knowing how he’ll make rent. For Raven Gilbert in North Carolina, it could mean struggling to buy food.

The deadline comes as the economic recovery shows signs of losing steam, with renewed outbreaks causing states to reverse or stall reopenings. These extra benefits have in some cases prevented working-class people — and the women and minorities who disproportionately rely on jobless benefits — from sliding farther down the ladder of prosperity.

Meanwhile, policy makers in Washington are at a standstill in their talks for more stimulus, and in particular whether to include an extension of the extra unemployment benefits. The weekly supplemental federal assistance was added to traditional unemployment benefits, which are administered by states and can vary widely in size.

Democrats want to extend the programme, called Federal Pandemic Unemployment Compensation. Republicans and the Trump administration have called for capping the amount of money jobless Americans can receive, seeing it as a disincentive to return to work. 
 

Interviews with those who have relied on the extra benefits offer a glimpse into a wide-reaching program that may yet prove crucial to the economy’s recovery.

For Chris Bolei, 63, the extra $600 a week is “a lifeline to our pre-pandemic existence.” Before the pandemic, Bolei, from San Rafael, California, was making about $75,000 a year as a maintenance supervisor. Even with the government aid he and his wife, who is high-risk for severe complications from Covid-19, struggle to pay their bills. 

Some Americans are making more money from jobless benefits than they did when they were employed. Two-thirds of workers who are eligible for unemployment insurance can receive more than what they lost in earnings, according to the University of Chicago.