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The outbreak of the COVID-19 pandemic has had a deep impact on the rate of unemployment in the United States.
The federal government passed a series of laws that would help people during this pandemic, including an additional $600 of unemployment benefits to help people.
The expiration of these benefits could also mean gig workers, freelancers, independent contractors, and small business owners — those who usually aren’t eligible for unemployment — will also lose this source of income.
Lawmakers in Washington are debating whether to extend these benefits. The November election is looming so the importance of deciding something is crucial.
Cutting the additional $600 would likely have devastating effects on consumer demand. Direct relief to unemployed workers is an effective form of economic stimulus, especially because the low-wage workers most exposed to the coronavirus also have the highest propensity to consume — meaning they return more relief dollars back into the economy compared to wealthy households.
By July 26, the enhanced unemployment benefits of an extra $600 per week on top of the usual allowance will end — a week sooner than originally expected, according to USA Today, which was first to report the news.
The United States Congress passed laws to provide unemployment benefits, such as the Coronavirus Preparedness and Response Supplemental Appropriations Act, 2020, the Families First Coronavirus Response Act, and the CARES Act. On May 8, 2020, the Bureau of Labor Statistics reported that 20.5 million nonfarm jobs were lost and the unemployment rate rose to 14.7 percent in April.
The unemployment rate increased from 3.5% in February to 14.7% in April, representing a decline of more than 25 million people employed, plus another 8 million persons that exited the labor force.
The outbreak of the COVID-19 pandemic has had a deep impact on the rate of unemployment in the United States. The World Economic Forum predicts a possible rise in the unemployment rate to 20%, a figure unseen since the Great Depression.
The United States Congress passed laws to provide unemployment benefits, such as the Coronavirus Preparedness and Response Supplemental Appropriations Act, 2020, the Families First Coronavirus Response Act, and the CARES Act. On May 8, 2020, the Bureau of Labor Statistics reported that 20.5 million nonfarm jobs were lost and the unemployment rate rose to 14.7 percent in April.
