Corrects second, third and fourth paragraphs to clarify that federal officials said states can use unallocated funds to extend the duration of some emergency unemployment programs, but not the $300-a-week federal supplement. Story was originally published Aug. 19.
State governments may choose to use unallocated recovery funds from the federal government to continue paying some emergency jobless benefits past their Sept. 6 expiration, Labor and Treasury Department officials said Thursday.
While federal pandemic employment programs will still end Sept. 6, states that haven't used their share of the $350 billion previously allocated by the American Rescue Plan can tap those funds to continue making some payments, Treasury Secretary Janet Yellen and Labor Secretary Martin J. Walsh wrote in a letter to lawmakers. That doesn’t apparently include a $300-a-week federal supplement to regular state benefits.
“As President Biden has said, the boost was always intended to be temporary and it is appropriate for that benefit boost to expire,” the letter from Yellen and Walsh said. They left room for the two other big programs—programs offering benefits beyond the normal duration and to the self-employed—to continue in states facing challenges. An estimated 7.5 million people on those two programs are expected to lose all benefits on Sept. 6, according to the Century Foundation.
Enhanced unemployment benefits were initiated last year in the CARES Act to help people who lost jobs due to pandemic-caused business closures stay afloat. That and subsequent legislation including the American Rescue Plan provided an extra boost to regular state-administered benefits (initially a weekly supplement of $600 and later the $300,) extended the duration of benefits, and opened the door to people who hadn’t been eligible for unemployment benefits before, including the self-employed and “gig” workers.
Where unemployment remains high, “it may make sense” to extend some assistance, Yellen and Walsh wrote, noting the delta variant of the coronavirus, the strain now dominant among U.S. cases, may “pose short-term challenges to local economies and labor markets.”
The Labor Department also is extending another $47 million in CAREER grants to help people get back to work, according to the letter, which stressed the need for unemployment insurance reform to remedy shortcomings exposed by the pandemic, such as vulnerability to fraud.
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