UNEMPLOYMENT SUPPORT

Unemployment benefits: how many people will stop receiving the money this week?

The federal government has been providing additional jobless support throughout the pandemic but 25 Republican-led states have decided to cancel the programme.

Unemployment benefits: how many people will stop receiving the money this week?
NICK OXFORD REUTERS

Since March 2020 the federal government has been offering out-of-work Americans an extra $300-per-week in unemployment benefits, but 25 Republican-led states have now decided to cut that short.

The payments were scheduled to continue until 6 September, after President Biden extended the programme that was introduced during the Tump administration. But now an estimated four million Americans will have the support cancelled before the end of July, with Alaska, Iowa, Mississippi and Missouri having already removed the additional payments.

From 19 June residents of Alabama, Idaho, Indiana, Nebraska, New Hampshire, North Dakota, West Virginia and Wyoming will no longer be able to receive the payments after their Governors decided that it was impeding the job market's recovery.

Indiana lawsuit demands that additional unemployment benefits remain

One of those set to end the programme this week is Indiana, but state Gov. Eric Holcomb is now facing a legal challenge over the decision. Indiana Legal Services, an organization which provides free legal assistance, and the Concerned Clergy of Indianapolis filed a complaint on Monday on behalf of five residents who are set to lose their unemployment benefits.

The lawsuit claims that the federal unemployment programme has served as a vital lifeline for thousands of Hoosiers," using the colloquial term for Indiana residents.

It continues: "By prematurely deciding to stop administering these federal benefits, Indiana has violated the clear mandates of Indiana's unemployment statute—to secure all rights and benefits available for unemployed individuals."

The lawsuit argues that for gig workers and some self-employed workers the additional unemployment benefits provide the only financial support available and are therefore essential to cover food, rent and other essentials. The claimants’ attorneys are requesting a preliminary injunction which would extend the payments while the case continues.

What has the White House said about the decision?

Biden was eager to see the additional unemployment benefits extended when he entered office and he maintains that September is an appropriate time for the programme to end. Speaking on 4 June, upon announcing the latest job’s report, Biden said "it makes sense" for the additional payments "to expire in 90 days."

However on this issue the Labor Department has no power to oblige states to participate in the federal unemployment programme and must respect the decisions made by the respective state governors.

There is concern that the decision to end the additional benefits will disproportionately affect people of colour, who have generally been worse-hit by the pandemic. The National Employment Law Project said: “The brunt of the impact will be felt by Black, Latinx, Indigenous, and other people of colour.”