Two national unemployment benefits programs driven by the CARES Act could soon stop, leaving millions of unemployed Americans with no safety net.
According to federal law, Pandemic Unemployment Assistance (PUA), which provides up to 39 weeks of unemployment insurance to unemployed persons that qualify for state unemployment benefits, will be terminated after the week ending December 26.
The Pandemic Emergency Unemployment Compensation (PEUC) program that extends a 13-week extension to Tennesseans who earned state benefits will expire the same week. About 13.3 million people sought extended jobless benefits under one of these two programs as of the latest available data from October 17.
According to economists, the help will end at a vulnerable time and cripple household spending among those workers. The U.S., however, is witnessing the third peak in new cases of coronavirus. Economists said that rising infected patients could lead to another business closure and associated layoffs, especially that the colder winter months are approaching that restrict outdoor activity.
After the year, many persons completing their state’s unemployment insurance allocation will continue collecting payments through government extended benefits programs. According to the Center on Budget and Policy Priorities, these programs are available in states with high unemployment levels and usually pay up to 13 to 20 additional weeks.
However, as their unemployment rate has risen, more than half a dozen states that paid extended compensation earlier in the recession have stopped doing so or have indicated they will do so in the coming weeks.
For months, congressional representatives and the White House have been in bitter talks over another possible coronavirus stimulus package. In May, a $3 trillion initiative called the HEROES Act would extend federal jobless assistance until the Democratic-controlled House of Representatives passed 2021.
The Republican-held Senate did not take up the bill and, in July, passed its own HEALS Act with reduced unemployment support before the end of 2020. Democratic House Speaker Nancy Pelosi is set for a $2.2 trillion relief package in recent negotiations.
The Senate and the White House were unable to find a consensus, mostly disagreeing with state and local government funding, increased unemployment benefits, and corporate liability protections. Only employees receiving routine state assistance will continue to receive benefits as of January 2021 unless Congress decides to pass a new law.