For countless Americans on vacation or laid off, the new coronaworld is like a nightmare, and it would have been worse without the passage of the Coronary Virus Assistance, Relief and Economic Security Act (CARES Act), which significantly increases unemployment benefits for almost everyone in the United States,media reported. Unfortunately, that doesn’t make much sense for the millions of Americans who have lost their jobs and haven’t got their money.
Nearly a third of unemployment benefits owed to Americans have not yet been paid, Bloomberg reported. From March to May, the Treasury Department paid out $146 billion in unemployment benefits, more than it did throughout 2009, according to data released Monday local time. But according to Bloomberg calculations, the Treasury department owes about $214 billion in those three months, meaning $67 billion remains unpaid.
Bloomberg notes that while CARES Act has expanded unemployment to more Americans and increased their benefits by $600 a week, many states are still flooded with unfilled claims. A Labor Department spokesman told Bloomberg that using weekly receiptreports is not a valid data point for unpaid data, adding, “Using these data is challenging because states are struggling to meet demand and some are processing backlogs of applications.” “This could mean that Bloomberg’s estimate is too low.
In addition, Bloomberg reported that while more than 2.6 million people in Texas have applied for unemployment benefits since March, about 650,000 of them have not received their benefits. While the state’s call centers have been expanded and staff redeployed, the state is also trying to reopen the economy, which means resources are being dispersed.
Despite the high infection rate of the new coronavirus, many U.S. states are reopening quickly, so the economy may start to rebound in the near future. But the road to recovery could be long, and both parties are now struggling to decide whether to extend the CARES Act beyond its July deadline. Bloomberg quoted business owners as saying they feared people would lose the incentive to return to work as a result of the benefits expansion, but that premature termination of benefits could trigger another economic crisis.