Two weeks have passed since President Donald Trump announced that he would sidestep a congressional stalemate to deliver $400 in extra weekly benefits to tens of millions of unemployed Americans — a short-term fix meant to replace the $600-a-week emergency federal supplement that expired last month.
Since then, as more details of the plan — known as Lost Wages Assistance — have emerged, so have problems with finding the funding and getting it to the hands of those who need it. What is now clear is that the federal supplement is $300 a week, not $400. And by Thursday, only one state, Arizona, had started paying out.
Here is what we know.
The federal government is offering an extra $300 a week to unemployed workers.
Trump is using money from the Federal Emergency Management Agency, which normally provides disaster relief. The additional $100 was supposed to be supplied by states, but most are struggling to meet other expenses. Tax revenues have been sinking at the same time that costs — like precautions to curb the spread of the coronavirus — have soared. Ultimately the administration said the states’ basic benefit payments could be counted toward their $100 share.
Montana is the only state so far to choose the $400 option, according to FEMA.
Jobless workers with the smallest benefits will not get the supplement.
Only people who qualify to receive at least $100 in unemployment benefits each week — either through the regular state program or a federal pandemic assistance program — are eligible for the extra federal funds.
In Colorado, for example, the rule leaves out 6% of those receiving unemployment pay — or roughly 28,000 people, said Cher Haavind, deputy executive director of the state Department of Labor.
One state has declined to take part. South Dakota’s governor, Kristi Noem, announced last week that her state would forgo the federal funds, saying they were not needed because South Dakota had recovered 80% of its job losses.
There are widespread delays.
Each state is supposed to administer the new supplement, just as it processes regular state unemployment insurance and federal pandemic jobless benefits.
In the spring, when state unemployment systems were overwhelmed with claims, there were delays of weeks or even months because computer systems had to be updated and reprogrammed, and staff members trained. Now states must again work out how to process a new program while they keep existing benefits flowing. New claims for state jobless benefits unexpectedly jumped in the most recent weekly report to 1.1 million.
On a conference call with reporters Thursday, John P. Pallasch, assistant secretary for employment and training at the Labor Department, said it could take some states up to six weeks to figure out how to get a program up and running.
As of Saturday, funds had been approved for 23 states: Alabama, Arizona, California, Colorado, Idaho, Indiana, Iowa, Kentucky, Louisiana, Maryland, Massachusetts, Michigan, Mississippi, Missouri, Montana, New Mexico, North Carolina, Oklahoma, Rhode Island, Tennessee, Texas, Utah and Vermont. Keith Turi, a FEMA official, said on the call Thursday that the initial approvals were for three weeks. “We’ll add additional weeks from there as needed,” he said.
Most states, though, are still reviewing the rules issued by the federal government to determine how to carry them out.
Florida is mulling “the best course of action that will preserve the state’s financial stability while providing important assistance to Floridians in need,” said Cody McCloud, press secretary to Gov. Ron DeSantis.
Ohio plans to apply but is considering what it needs to do to upgrade its systems, said Bret Crow, a spokesman for the Ohio Department of Job and Family Services.
States have until Sept. 10 to apply for the funds.
The extra benefit is likely to run out after five weeks.
To finance the program without a congressional appropriation, Trump set it up to draw from federal disaster funds — a limited pool — and the administration said that no more than $44 billion would be spent.
According to estimates from FEMA and the Labor Department, that sum will cover four or five weeks of payments to unemployed workers who are eligible. The funds are supposed to be retroactive to Aug. 1, so recipients might be paid only through early September.
Congress is at an impasse on longer-term support.
Trump acted after Democrats and Republicans were unable to work out a deal on supplemental benefits before the August congressional recess. Democrats have steadfastly supported restarting the $600 weekly booster that ended last month. Republicans have pushed for a smaller supplement — initially proposing $200 a week, arguing that bigger sums discourage people from returning to work.
Studies by economists across the political spectrum have concluded that the additional benefits have not deterred job seekers. The latest, by the Becker Friedman Institute for Research in Economics at the University of Chicago, found that despite anecdotal reports of people turning down jobs, “very few workers would not have returned to work” if given the opportunity. For most, the temporary nature of the supplement, the difficulty of finding another job, and concerns about career setbacks and permanently lower wages outweigh the short-term financial gain. And workers who reject job offers are no longer eligible for unemployment benefits.
Nearly 30 million people are receiving some form of jobless benefits. At the end of June, there were roughly 5.9 million job openings.
Economists said the emergency federal checks this year have kept the economy functioning, fueling spending that has supported restaurants, retailers and other businesses. The $600-a-week supplement injected roughly $70 billion a month into the economy between April and July, almost 5% of total household income.