Unemployment benefits fall below the poverty line in 13 states


Unemployment insurance benefits in 13 states have fallen below the poverty line in 13 states after weekly federal support of $ 600 a week expired in late July, according to a new report from the government’s accounting office.

The $ 2.2 trillion CARES law passed by Congress in March increased unemployment benefits for laid-off workers by $ 600 a week.

When the $ 600 a week ended in July, the typical unemployment check returned to an average of $ 330 a week. But in 13 states, the average weekly unemployment check has dropped below $ 245 – the minimum weekly income needed to live above the poverty line in the United States, the Congressional Guard reported.

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For months, Congress has tried to conclude another corona virus clearance agreement, but lawmakers remain sharply divided between the size and scope of the legislation.

One of the key points in the talks was the size of unemployment benefits: Democrats say $ 600 a week is needed to bridge the gap between unemployment benefits and median income, while Republicans insisted it was a disincentive to work, noting that the University of Chicago According to a study written by economists at the Becker Friedman Institute, about two-thirds of the unemployed received more government support than they were looking for in their old job. Most economists dispute this view.

In September, President Trump signed a number of enforcement orders, including one providing an additional $ 300 a week in benefits for six weeks a week. GAO noted that the money has since run out.

Lack of federal funding and persistently high unemployment put a strain on states, 20 of which reported holding about $ 40.2 billion in federal loans – the same as a larger group of states owed after the 2008 financial crisis. .

“This total credit balance is roughly equal to the approximately $ 40.2 billion held by 30 states and territories at the end of 2010, the culmination of 18 months of borrowing between 2007-2009 and early recovery,” the report said.

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Meanwhile, a special CARES Act program – the Pandemic Unemployment Assistance (PUA) – set up for workers who are not normally entitled to benefits has performed even worse: in 29 of the 41 reporting countries, benefits fell below the poverty line.

When the PUA and another federal unemployment benefit program expire at the end of December, about 12 million workers will be left without income, according to a study published by the Century Foundation nonprofit think tank.

Job losses remain high, and as COVID-19 cases increase across the country, prompting state and local governments to implement new closure measures, economists are increasingly warning of a bleak winter.

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– There was no bigger demand [stimulus] it’s been a long, long time here, ”said Federal Reserve President Jerome Powell last week’s call to Congress and the White House for another stimulus package.