Even with end to $300 extension, jobless rolls won’t drop quickly: Experts
(CNN) – April Stokes wants to go back to work.
An optician by trade, Stokes was employed at Henry Ford OptimEyes until the coronavirus struck and school closed for her two young children.
The family has been able to ride out the pandemic thanks to expanded federal unemployment benefits, which provided them with $1,152 every two weeks — much less than Stokes was making before, but enough to survive.
Now, however, that vital lifeline has ended. Stokes isn’t worried about her ability to find a new job, but finding one that can accommodate her children’s schedules will be “next to impossible,” she says. Child care in the Detroit suburb where she lives is severely limited, she said, and the nanny she trusted to pick up the kids in the afternoon prior to the pandemic is no longer available.
“The government is not leaving us with any options,” said Stokes, noting that officials are pushing people back to work while telling them that the Delta variant remains a concern. “There are a lot of single moms out here that are really panicking right now and don’t know what to do.”
Nearly 18 months after Congress came to the rescue of jobless Americans, its historic expansion of the nation’s unemployment benefits system expired nationwide this weekend.
Lawmakers, who extended the three pandemic programs in December and March, are not expected to renew them again.
A key component of the relief effort was a federal weekly supplement for out-of-work Americans. Initially, the jobless received a $600-a-week boost from April through July of 2020. Congress then revived the enhancement in late December but reduced it to $300 a week.
Lawmakers also created two other measures to aid the jobless when the coronavirus struck. The Pandemic Unemployment Assistance program provided payments for freelancers, the self-employed, independent contractors and certain people affected by the outbreak, while the Pandemic Emergency Unemployment Compensation program extended payments for those who’ve exhausted their regular state benefits.
President Joe Biden said last month that states can use federal relief funds to extend the programs beyond Labor Day, but so far none have said they will do so.
The end of the safety net comes as the Delta variant is weighing on the economy and dampening hiring. The US added only 235,000 jobs in August, far lower than economists had been expecting and the smallest increase since January.
More than 8 million people are now left with no unemployment compensation at all, while another 2.7 million lost the $300 federal weekly boost but will continue receiving state payments, according to estimates by The Century Foundation.
They join the roughly 2.7 million Americans who were cut off from some or all of their benefits in June or July after two dozen states opted to terminate at least one of the programs early. The governors — all but one of them Republicans — wanted to push their residents to look for jobs.
Though there are a record 10 million job openings in the US, employment is not expected to soar, at least not right away, experts said. The labor markets did not greatly improve in the states that ceased benefits over the summer.
The generous benefits are not the only reason for the relatively slow pace of hiring. Child care and health concerns are also major factors.
More than 5.5 million people said they are not working because they are caring for children who are not in school or day care, according to the most recent Census Bureau Household Pulse Survey, conducted in the first two weeks of August. Another 3.2 million said they are concerned about getting or spreading the coronavirus.
Economic uncertainty is also an issue. People are being thrown into the labor market at a time when the Delta variant is affecting consumers and businesses, said Andrew Stettner, senior fellow at The Century Foundation. The uptick in cases is prompting some people to pull back on traveling and eating out and some businesses to cancel events. That may lead employers to scale back their hiring.
“We’ve protected people up until now from the real damage of long-term unemployment,” Stettner said. “Now we have to see whether this job market is really strong enough to keep people out of long-term harm at a time when people don’t have some of the other protections — like the housing protections — they had during the pandemic.”
Hundreds of out-of-work Americans wrote to CNN about why they are having trouble returning to the labor market at this time. Some said good jobs remain scarce, others said the virus is still affecting their business and still others cited family or health reasons.
Take Valerie Giguere, who lives in Rhode Island.
She owns Gourmet Traveler, which offers bus tours to New York City and New England destinations, as well as trips overseas. Giguere had hoped business would pick up in 2021 after Americans started getting vaccinated, but the Delta variant has forced her to cancel several excursions to New York City this summer and to postpone two European tours until next year.
The $424 she was receiving in weekly pandemic jobless benefits helped her pay her bills and invest some in the company to prepare for when travel picks up again. She and her husband both receive Social Security, but it’s not enough to cover all their basic expenses, especially with inflation pushing up prices for food and other necessities.
Without the unemployment compensation, she fears she may fall behind on some bills and have to further cut back on groceries, particularly meat.
“Just knowing you have that little bit of money that they were giving me, that was a good thing,” Giguere said. “That’s what saved me through all of 2020 and most of 2021.”
Fear of the coronavirus has kept some Americans from returning to the labor market.
Rebecca Ruiz started homeschooling her two young granddaughters after her husband died of Covid-19 earlier this year. Ruiz, who has custody of the girls, is worried they could bring the virus home to her — a chance she’s not willing to take.
The $900 she received in unemployment payments every two weeks, coupled with Social Security benefits, helped the family survive — especially after they lost her husband’s income from his job at a supermarket.
“Right now, all I can do is make my pennies stretch,” said Ruiz, who did office work for a trucking company that shuttered at the start of the pandemic. The California resident is now hoping to find a position that will allow her to work from home.
Meanwhile, some laid-off Americans report they aren’t getting interviews or offers despite sending out a multitude of resumes.
David Grein, who has worked in hospitality for more than 30 years, has been applying for jobs throughout the pandemic after losing his position as a chef at a retirement community in early 2020. Most of the postings call for less experience and offer a lower hourly wage than he’s made in the past. Grein, who turned 64 on Monday, suspects his age also plays a factor.
The Illinois resident has an interview on Tuesday for a chef position that pays $21 an hour — which would be a big cut — and could entail a 45-minute commute depending on traffic. But now that he’s lost his unemployment compensation of $1,060 every two weeks and is holding off on taking Social Security so he can get the full benefit in 2.5 years, he can’t afford to be too choosy.
“I’m at the point that the gun is to my head regarding income. I have none,” he said, noting that he also needs employer health insurance to cover his diabetes care.