Economy

Extension Of Unemployment Benefits Could Run Out In Weeks, Report Finds

An additional $400 a week in jobless benefits extended by President Donald Trump through an executive order may run out much sooner than anticipated, a new report finds.

Trump’s executive order, which he signed on Saturday (Aug. 8), would provide $300 a week in additional unemployment benefits from the federal government, matched by a $100 payment by individual states.

The order came as an additional $600 a week in jobless benefits – relied upon by tens of millions of workers to pay their bills – expired on July 31 amid a deadlock in negotiations on Capitol Hill over a new coronavirus relief bill.

However, while Trump’s executive order anticipates that the extension will keep jobless workers afloat until early December, the program, which draws upon funding from the Federal Emergency Management Agency, has only enough cash to last about six weeks, The Wall Street Journal reports, citing a senior Labor Department official.

That projection is based on all states taking part in the program, drawing down the $44 billion in FEMA disaster relief funding that the Trump administration plans to tap. As of mid-July, more than 30 million workers were receiving some form of unemployment benefits.

In addition, state unemployment programs, which struggled to keep up with the massive pace of claims this spring after the coronavirus downturn triggered unprecedented job losses, will now have to make further adjustments to their internal systems, a process that could take a couple of weeks, according to the senior official interviewed by the Journal.

The concerns over the stop-gap nature of the $400-per-week extension in jobless benefits comes as both parties in Congress and the Trump administration remain at odds over a proposal for another coronavirus relief bill.

While House Democrats have pushed for a $3 trillion rescued package that would extend the additional $600-per-week unemployment benefit, Republicans have pushed for a smaller, $1 trillion package that would also extend that benefit, but at a significantly lower level.

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NEW PYMNTS DATA: HOW WE SHOP – SEPTEMBER 2020 

The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.

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