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Millions of Americans lose jobless benefits as $900B relief bill sits on President Trump's desk

Denitsa Tsekova
·Reporter
·5 min read
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Unemployment benefit programs covering millions of Americans are ending as the stimulus deal passed by Congress, which would extend the programs, sits on the president’s desk.

“A complete unforced error,” Andrew Stettner, an unemployment insurance expert and senior fellow at the Century Foundation, told Yahoo Money. “At this point, [jobless Americans are] really at the edge, and they don't have any more further to cut. It's going to throw them into disarray.”

Around 14 million Americans currently rely on Pandemic Unemployment Assistance (PUA) and Pandemic Emergency Unemployment Compensation (PEUC), both of which are expiring on Saturday. While some unemployed Americans could move to another program, around 10 million will be ineligible. Nearly 5 million people are expected to fall into poverty in January as a result of relief provisions expiring.

“That’s the last week of compensable unemployment,” Stettner said. “Most people will probably get their final deposit into their bank account early next week, but they won't be able to claim any more benefits.”

WEST PALM BEACH, FLORIDA - DECEMBER 23: U.S. President Donald Trump and First Lady Melania Trump exit from Air Force One at the Palm Beach International Airport on December 23, 2020 in West Palm Beach, Florida. President Trump is scheduled to enjoy a 10-day holiday visit at his Mar-a-Lago resort during the last Christmas of his precedency. (Photo by Joe Raedle/Getty Images)
U.S. President Donald Trump and First Lady Melania Trump exit from Air Force One at the Palm Beach International Airport on December 23, 2020 in West Palm Beach, Florida. President Trump is scheduled to enjoy a 10-day holiday visit at his Mar-a-Lago resort during the last Christmas of his precedency. (Photo by Joe Raedle/Getty Images)

And even if the bill was signed now there would still be a lapse in benefits for the unemployed and reprogramming the benefit payments will take a few weeks.

“If the bill is signed then people are continuously eligible,” Stettner said. “Every day delayed adds to the complexity of getting the benefits back up and running.”

On December 21, Congress overwhelmingly passed a $900 billion stimulus deal that would extend both programs until March 14. But without the president signing the bill into law, the lapse is the earliest cutoff in extended benefits in any recession since 1985. Trump threatened he won’t sign it unless the current $600 stimulus check is increased to $2,000 creating uncertainty over the bill’s future.

The president didn’t say whether he’ll veto the bill but hasn’t signed it as of Saturday. In a tweet on Friday evening, Trump doubled down on his demand for bigger stimulus checks in any stimulus legislation.

A two-thirds vote in both chambers of Congress would be required to override a presidential veto. Complicating matters is that the bill is attached to another piece of legislation to keep the government funded. If Trump doesn’t sign the conjoined pair, the government faces a shutdown on Dec. 28.

Both the Pandemic Unemployment Assistance (PUA) and the Pandemic Emergency Unemployment Compensation (PEUC) programs are set to expire on December 26 unless Congress reaches a stimulus deal.
Both the Pandemic Unemployment Assistance (PUA) and the Pandemic Emergency Unemployment Compensation (PEUC) programs are set to expire on December 26 unless Congress reaches a stimulus deal.

‘It's really a disaster’

As of Saturday, jobless Americans are facing their third benefit cliff in the pandemic. The extra $600 in weekly unemployment benefits under the CARES Act expired in July and the extra $300 under the Lost Wages Assistance (LWA) program expired in September.

“These people are going to fall into poverty, they are going to lose their homes, people are going to sell their cars,” Stettner said. “It's really a disaster.”

It’s not just unemployment programs expiring: The federal eviction moratorium, paid sick leave provisions, aid to state and local governments, and other relief expires at the end of December.

LOS ANGELES, CALIFORNIA - DECEMBER 25: Community members wait in line to receive holiday-themed takeout meals and backpacks with toiletries from the Midnight Mission in Skid Row on Christmas day amid the COVID-19 pandemic on December 25, 2020 in Los Angeles, California.  California has become the first state to hit 2 million COVID-19 cases. Southern California remains at zero percent of its ICU (Intensive Care Unit) available bed capacity amid a spike in coronavirus cases and hospitalizations. (Photo by Mario Tama/Getty Images)
Community members wait in line to receive holiday-themed takeout meals and backpacks with toiletries from the Midnight Mission in Skid Row on Christmas day amid the COVID-19 pandemic on December 25, 2020 in Los Angeles, California. (Photo by Mario Tama/Getty Images)

Around 3 million workers on PEUC may be able to move to Extended Benefits (EB) a federal program that provides additional 13 weeks but that program is also expiring in many states as their unemployment rates decrease. Only 18 states are projected to have the program in place by the end of December.

For jobless Americans, the $900 billion stimulus deal would have meant an extra $300 a week added to their benefits as well as PEUC and PUA programs extended so that people could receive benefits for another 11 weeks. Along with that, some overpayments would be waived, and some workers may even get an extra $100 on top of the $300 a week.

‘The pandemic has really exacerbated it’

As a result of the expiring relief, the number of people in poverty would increase by 4.8 million in January, according to an analysis by Columbia’s Center on Poverty and Social Policy.

“It's really keeping both the workers and their whole families, afloat,” Megan Curran, a postdoctoral research scientist, and co-author of the report told Yahoo Money. “But it also means that the workers and their whole families are at risk of losing out.”

The potential January jump in poverty would come after millions have already fallen into poverty since the summer. A total of 7.8 million Americans have entered poverty since June, according to a University of Chicago and Notre Dame study found. A similar study by Columbia’s Center on Poverty and Social Policy found that 5.5 million have fallen into poverty from May to October.

Black Americans are falling into poverty in the greatest numbers during the pandemic and will be disproportionally affected by the current benefit cliff with 1.4 million expected to enter poverty in January.

“This disparity was a problem before the pandemic but the pandemic has really exacerbated it,” Curran said. “Job loss has hit them disproportionately and poverty, therefore, has also hit them disproportionately.”

Yahoo Money sister site Cashay has a weekly newsletter.
Yahoo Money sister site Cashay has a weekly newsletter.

Denitsa is a writer for Yahoo Finance and Cashay, a new personal finance website. Follow her on Twitter @denitsa_tsekova.

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