Extra $600 in pandemic unemployment aid may end a week early for some

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Some of the roughly 33 million workers who are now claiming unemployment benefits may be in for an unwelcome surprise next month. The extra $600 in weekly unemployment benefits that are due to expire on July 31 may end a week earlier in some states. 

The reason is due to the schedule for paying out unemployment benefits. The Coronavirus Aid, Relief, and Economic Security Act, or the CARES Act, set July 31 — a Friday — as the final day for paying the additional $600 in weekly pandemic-relief benefits. But some states pay out their unemployment benefits on weeks that end on Saturdays or Sundays.

If that’s the case in the state you live in, according to the U.S. Department of Labor, the last week to receive the extra benefit will be the week ending Saturday, July 25, or Sunday, July 26. 

Among the states where unemployment benefits will end earlier than July 31 are California and New York, with their labor departments ending their payment cycles on July 25 and July 26, respectively. They also have more workers claiming unemployment than any other states, with more than 3 million in California and 1.8 million in New York, according to an analysis from the left-leaning Economic Policy Institute. 

After that date, unemployment benefits will return to their pre-pandemic levels, which vary according to state but are considerably less generous. For instance, the regular unemployment benefit in California is $167 per week, while laid-off New Yorkers receive up to $504 per week, depending on their income while working.

Nationally, more than 1 in 5 workers is either receiving or has recently applied for unemployment benefits, the EPI said in its analysis. 

The extra $600 per week in additional benefits is credited with helping keep many households afloat during the recession sparked by the coronavirus pandemic. While there have been calls to extend the benefit, it’s unclear whether that will occur past the July 31 cutoff. 

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The Heroes Act, passed by the House last month, would extend the benefit until early 2021, but some Republican lawmakers have signaled their opposition based on the belief that receiving extra unemployment pay is a disincentive to return to work in many states where wages are lower than what the expanded unemployment benefit pays out.

“These benefits are a critical lifeline that help workers make ends meet while practicing the necessary social distancing to stop the spread of coronavirus,” said EPI state economy analyst Julia Wolfe in a blog post last week. “In fact, the $600 increase in weekly UI benefits was likely the most effective measure in the CARES Act for insulating workers from economic harm and jump-starting an eventual economic rebound, and it should be extended past July.”

Losing the extra $600 earlier than expected may prove not only a financial shock to those households, but also to local economies. Without continuing assistance, more Americans may struggle to pay their bills or rent, leading to evictions and defaults on loans.

“With expanded unemployment benefits set to expire at the end of July, a failure to provide further fiscal support would severely constrain income and further weigh on the nascent recovery,” Oxford Economics economist Lydia Boussour wrote in a research note last week. 

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