Sun, May 19, 2024

US July Employment Pulse Weak, Financial Aid Set to End

US dollars economy.

The United States experienced a reversal in what are the already “improving” unemployment stats, recorded last month. The US Department of Labor expects another 1.3 million Americans added to the first-time jobless claimers for federal unemployment benefit for the week ending on July 18, 2020. For the time being, some 17.1 million are to retain their spots in the continuing claims list.

The financial aid for jobless citizens, at $600 per week ($2,400 a month), will end on or before July 31. The unemployment insurance is part of the country’s “ambitious” $2 trillion stimulus package under the CARES Act signed into law in March. This was initially projected to stop economic bleeding but would be inefficient in its cause. Its successor, the Heroes Act, is still in-talks for approval. The second stimulus package, passed in May, is at a proposed value of $3 trillion.

While the pandemic continues to wreak havoc, economists consider the possibility of a double-dip recession. In an interview, President Trump admitted that the situation in the US is not looking good and could get worse. He reminded his citizens to follow the mandatory rule of wearing masks.

Is a $600 Weekly Financial Aid Too Generous?

US flag with unemployment word.

Many analysts believe that the unemployment insurance benefit might be too good to handle. Poverty rates for the periods covered by the aid remained on the status quo despite the alarming addition of unemployment aid claimants, averaging to a million more per week. 

Unemployed citizens who are recipients of the financial aid prefer to stay inside their homes rather than risking their lives going to work at possibly lower monthly incomes compared to what they get from the government. 

Should the financial aid continue, Republicans will consider lowering the benefit’s value. They proposed $100 per week in aid or a total of $400 per month. This will continue until the end of the year. Even when the largest economy in the world is already waiting in the front seat for the Covid-19 vaccines, a tight grip on funds may be strategic, as things could get worse before they get better.

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