The $600 in extra federal unemployment benefits expires this week.
How many people receive the $600?
“This is turning into a deterrent to get people to go back to work,” says Dr. Michael Busler, a public policy analyst and a professor of finance at Stockton University in New Jersey. “The stimulus has been sufficient so far. But we could be going through a second wave of the virus. Let’s give it more time and reconsider later.”
The labor market is facing a net loss of 14.7 million job losses from the coronavirus recession. Jobless claims remain historically high and permanent job losses are growing, a troubling sign for the labor market. In June, the number of people who have permanently lost their job rose by 588,000 to 2.9 million.
“Removing this lifeline would only drive the economy into a deeper recession,” warns Michael Klein, professor of international economic affairs at The Fletcher School at Tufts University and former chief economist in the Office of International Affairs of the Department of the Treasury. A worker earning the federal minimum wage of $7.25 per hour who works 40 hours per week earns $290 per week in gross wages—less than half of the $600 weekly increase, according to The Brookings Institution, a nonprofit public policy organization. On average, a worker collecting unemployment and the $600 is making between $20.38 per hour in Mississippi to $28.75 in Massachusetts.
But customizing the benefits to match people’s salaries posed challenges due to outdated state unemployment systems. In March, Congress opted to give Americans a $600 bonus payment to equal the average wage, or about $1,000 per week.
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