Due to delays in stimulus negotiations, extra unemployment payments from the federal government aren’t likely to be issued until after Labor Day.
After lengthy negotiations, there’s still no viable deal on a second stimulus package, which is expected to include some form of additional aid to those who lost their job due to the pandemic.
Adding to the delay: The Senate is set to go on recess until Sept. 8, the day after Labor Day.
Talks among the White House, the Treasure Department and lawmakers dragged into the evening Aug. 6. Afterward, Secretary of Treasury Steven Mnuchin said they are “still very far apart” on the specifics.
An estimated 30 million unemployed Americans were relying on Federal Pandemic Unemployment Compensation, the $600-per-week boost, when it expired July 31, according to data from the Department of Labor.
Like the CARES Act, this next stimulus bill will be expansive, and is expected to include extensions to unemployment payments, another stimulus check and several other relief measures for businesses and workers.
The House of Representatives passed a bill in May that kept the $600 weekly boost in place and extended the time frame until 2021. But that bill was dead on arrival in the Senate.
The Senate then missed the July 31 expiration date but set a self-imposed deadline to have an agreement on the second stimulus package ready to go by Friday, Aug. 7, before the Senate went on a weeks-long recess. Due to the breakdown in negotiations, they missed that deadline, too.
Millions of jobless Americans must make do with reduced unemployment payments, as lawmakers are deadlocked on deciding how much the weekly unemployment boost should be and for how long it should last.
State unemployment offices issued the last round of boosted weekly payments July 26.
Even if lawmakers immediately agreed on a proposal, it would still need to be voted on in both the Senate and the House and signed into law by the president.
Then, state unemployment agencies would have to scramble to implement it. According to unemployment policy experts, that will also take time.
“To get [enhanced payments] started back up again, it may take a while to reprogram,” Michele Evermore, senior policy analyst at the National Employment Law Project, recently told CNBC. “I’ve been told that even in states with modernized systems, it could still take weeks.
Without the $600 federal boost, subsequent unemployment payments will remain significantly lower until an agreement is made.
For example, Unemployment Insurance recipients in Louisiana, the state with the lowest average payments, are receiving only $182 per week, a 76.7% decrease from just a couple weeks ago. Hawaii, the state with the highest weekly unemployment payments, currently pays $456 on average. Hawaiians are coping with a 56.8% decrease in weekly payments.
Recipients of Pandemic Unemployment Assistance are receiving much less: half of their state’s average UI payment — meaning average payments vary between $91 to $228 per week, depending on the state.
In the early afternoon of Aug. 6, before negotiations broke down, the president floated the idea of taking executive action if lawmakers couldn’t come to an agreement.
Upon departing the Oval Office for Ohio, I’ve notified my staff to continue working on an Executive Order with respect to Payroll Tax Cut, Eviction Protections, Unemployment Extensions, and Student Loan Repayment Options.
— Donald J. Trump (@realDonaldTrump) August 6, 2020
“I’ve notified my staff to continue working on an Executive Order with respect to Payroll Tax Cut, Eviction Protections, Unemployment Extensions, and Student Loan Repayment Options,” the president tweeted.
It’s unclear if the president has the legal authority to act unilaterally. And even if he does, still, the question remains: By how much will the federal government boost weekly payments, and for how long?