This statement was published in response to the August 13, 2020 release of jobs numbers by the Bureau of Labor Statistics. For the most up-to-date data please visit TCF’s comprehensive UI data dashboard here.
Today’s Labor Department report underscores the ongoing impact of the untimely cut off of federal unemployment benefits, and offers more evidence that the President’s Executive Order won’t meet the challenges facing unemployed workers and the economy.
This week marked the first time we have data on both new and continued claims for unemployment benefits filed after the July 31st expiration of the CARES Act $600 weekly boost. In the week ending August 1, 15.2 million workers filed continued unemployment claims for state benefits. That figure is only down 4 percent from last week, despite the lack of incentive to get the $600 boost, a smaller decline than the week ending July 25, the last time workers were able to file for the $600.
On top of these continued claims, more than 1 million people newly filed for unemployment benefits, including 963,000 who filed for state benefits that now average only $309 per week, as well as 489,000 who filed for federal PUA that averages just $190 per week. Moreover, workers are finding themselves out of work for long stretches of time, as the number of people collecting extended PEUC benefits crept up again to a new high of 1.2 million.
All told, there were 29 million unemployment claims filed last week, representing 18 percent of the workforce, at a time when unemployed workers face deep uncertainty about when they will be able to return to work. These workers must survive on meager base benefits because of the failure of the Administration to reach an agreement with Congress to extend the PUC lifeline.
Workers will get little to no relief from the haphazardly crafted executive action announced by the President last week. Nearly a week after the announcement was made, there are more questions than answers about the new program of “Lost Wages Assistance” advertised as a replacement for the successful CARES Act program:
- When will workers get benefits? The new “Lost Wages Assistance” program must be run separately from state unemployment benefits programs. It will take weeks if not months for states to set up new procedures.
- How much will benefits be? Lost Wage Assistance was touted as a $400 per week benefit, with states paying $100. When states balked, the Administration backed tracked and said workers would only get $300 per week
- Is it legal? The Administration is doing an end-around on the legal 25 percent matching requirement, allowing states to count regular unemployment as a match.
- How will states pay for this? States cannot use any existing unemployment funds or regular state staff for the program, so will have to use a meager 5% of grant funds to set up a new benefit that will only pay out checks for a few weeks.
- Who will get benefits? The program requires states to exclude any worker getting less than $100 in underlying unemployment benefits, further complicating required reprogramming. Only 3 states—Ohio, South Carolina and West Virginia—have indicated they are participating in the program.
- What will happen when funds run out, or are needed for their original purchase? The Administration is tapping into up to $44 billion in the Disaster Relief fund, only enough to extend additional benefits to early September. The amount could be cut at any moment if the funds are needed for their usual purpose of natural disaster relief.
The Trump Administration’s bungled roll out has exposed this new program as an act of desperation and political cover rather than a serious plan to meet the needs of unemployed families. By distracting Americans and Congressional leaders from the critical need to legislate a solution, the Executive orders are costing working families billions of dollars in aid—at least $15 billion this week alone—and depriving the economy of consumer spending badly needed to power a jobs recovery.