Great Britain

1.3m more file for unemployment as US economy continues to reel

1.3 million more Americans filed for unemployment in the US last week as the economy continues to reel from the effects of the Covid-19 pandemic.

The number of new claims has dropped over the last 16 weeks, decreasing 10,000 last week compared to the week before, though the number has hovered above 1 million over the last month.

Those who have just started to receive unemployment may only get a few weeks of the additional $600 the federal government gives to those claiming unemployment insurance. The extra money, given on top of what states give through their own programs, is set to expire at the end of the month. Without the additional cash, the average unemployment check is about $350 a week.

Lawmakers will return to Congress to negotiate a possible extension on 20 July, but they will have less than two weeks to come to a compromise before the extra cash is scheduled to stop. In the meanwhile, the Trump administration unveiled its solution to relieve the millions who are unemployed: a campaign telling them to find a new job.

Shutdown orders in March caused a huge increase in new unemployment claims, which peaked at over 6m claims in one week at the end of March. As states began to unroll reopening measures in May, the economy saw much-needed, though small, relief. The country had 4 million people go back to work in June.

But those reopening measures may have come at a steep price. Some of the states that were among the first to reopen have seen dramatic upticks in new cases over the last few weeks. A handful, including California, Texas and Arizona, implemented some type of reopening reversals, targeting indoor spots like dine-in restaurants, bars and gyms, potentially leaving many unemployed once again.

And millions more Americans remain unemployed after months of being out of work. In the middle of June, over 17 million Americans were still unemployed, with thousands more leaving the workforce entirely.

That figure does not include gig workers who traditionally do not qualify for unemployment but were made eligible to receive benefits through the Pandemic Unemployment Assistance program that was created as part of the Cares Act. As of last week, over 14 million people in 47 states were claiming unemployment insurance as part of the program, according to this week’s figures.

One of those people is Cindy Lang, who has run her own house painting business near Cleveland, Ohio, for 18 years and has clients in seven states. She’s making about 25-30% of her regular income because fewer people are seeking her services and she needs to protect herself from clients who don’t want to follow social-distancing guidelines or wear masks while she’s inside their home working.

Lang, 57, is the primary caregiver for her disabled elderly parents, who both suffer from respiratory illnesses. She said the inability to work normally has been “a long, tumultuous nightmare”.

It took three months for her to receive her first unemployment check and during that period she relied on food stamps and programs which deferred her mortgage payments and utility bills. Those payment deferral programs are about to end, as is the government’s $600 boost to weekly unemployment benefits

Without the extra $600, Lang will have to survive on $180 a week in state unemployment insurance. “I would not be shocked if I end up having to file for bankruptcy or lose my house,” Lang said.

She urged politicians who have yet to find a replacement for the $600 program, and especially those who want to end it, to spend a couple hours with her and other unemployed people to understand how much stress they are under. Lang said: “I wouldn’t wish this on my worst enemy.”

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