Coronavirus: financial aid impact on employment in the U.S. - statistics & facts
Starting in early 2020, the effects of the coronavirus (COVID-19) pandemic could be felt throughout the entirety of the United States as millions of citizens lost their jobs and businesses. In response, the government issued various stimulus packages and financial aid to hep curb the rise of unemployment and detriment to the economy. However, the negative effects of both the initial lockdowns and the subsequent government actions are still being felt deep into 2021
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On the other hand, the number of new unemployment insurance claims has been decreasing on a weekly basis to around 400,000 new claims in May 2021. However, this could be due to the fact that many Americans are already receiving the unemployment payments from earlier in the pandemic, as there seems to be little incentive to leave those payments. In any case, either from the coronavirus itself or the increased access to lucrative benefits, the unemployment rate in the U.S. has yet to return to the pre-pandemic levels, regardless of the nation's apparent readiness for normalcy.
Unemployment Benefits
In March 2020, President Donald Trump signed the Families First Coronavirus Response Act (FFCRA) to provide additional funding and flexibility to state unemployment insurance agencies. It was quickly followed by the Coronavirus Aid, Relief, and Economic Security (CARES) Act which added additional funding and allowed unemployment benefits for workers who are not ordinarily eligible for unemployment benefits. Despite these efforts, many Americans were still exposed to job loss due to COVID-19. Therefore, almost an entire year later, President Joe Biden signed the American Rescue Plan Act of 2021 to add an additional 300 U.S. dollars per week to the unemployment benefits that Americans were already receiving. Additionally, the timeframe of extra benefits was extended to September 2021. While many are glad to see these payments, there are some who are concerned with the billions in monthly unemployment insurance benefits spending.Impact on Employment
Despite their intentions, these relief plans may have had a negative impact on the employment levels in the United States. The problems arises from the value of the unemployment benefits which have begun to out-incentivize a paycheck. For many Americans, an unemployment check is now greater than what they would get working a full-time job. As a result, the number of persons not participating in the labor force has remained over the past year. Furthermore, it is difficult to claim that these unemployment figures are due the pandemic closing jobs, as the U.S. reached a new high of over eight million job openings in recent months.On the other hand, the number of new unemployment insurance claims has been decreasing on a weekly basis to around 400,000 new claims in May 2021. However, this could be due to the fact that many Americans are already receiving the unemployment payments from earlier in the pandemic, as there seems to be little incentive to leave those payments. In any case, either from the coronavirus itself or the increased access to lucrative benefits, the unemployment rate in the U.S. has yet to return to the pre-pandemic levels, regardless of the nation's apparent readiness for normalcy.
