COVID-19

Half of Americans who lost work or wages are getting $0 jobless benefits

Mitchell Hartman May 18, 2020
Heard on: Marketplace
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An applicant fills out an unemployment benefits form in Virginia. Temporary relief payments are scheduled to end soon. Olivier Douliery/AFP via Getty Images
COVID-19

Half of Americans who lost work or wages are getting $0 jobless benefits

Mitchell Hartman May 18, 2020
An applicant fills out an unemployment benefits form in Virginia. Temporary relief payments are scheduled to end soon. Olivier Douliery/AFP via Getty Images
HTML EMBED:
COPY

There’s a fierce debate going on in Washington, D.C., about whether to pass another round of stimulus on top of the trillions of dollars previously approved by Congress to help American businesses and households weather the pandemic economic storm.

A lot of federal money has already been earmarked to help people who have lost work and income due to COVID-19. Through the CARES Act, Congress added $600 a week in Pandemic Unemployment Compensation to every regular state unemployment insurance check going out right now and extended the duration of benefits for 13 additional weeks.

In addition, millions of people who wouldn’t ordinarily qualify for state unemployment insurance are now eligible for full benefits under the Pandemic Unemployment Assistance program. That includes gig workers, solo business owners and those out of work due to the pandemic, like people who have school-age children to take care of at home and ride-share drivers whose business has dried up.

Still, state and federal jobless benefits aren’t getting to millions who are eligible and need the money.

A report from the Brookings Institution’s Hamilton Project finds that according to the Treasury Department, federal and state governments had sent out $48 billion in unemployment checks by the end of April. But the amount of income that Americans lost in April from layoffs and lack of work due to the pandemic was at least $80 billion.

“The unemployment insurance probably covered about half of the drop in personal wage and salary income,” said Hamilton Project director Jay Shambaugh. “It’s not that everybody’s getting half as much unemployment insurance as they should. It’s really more — half of people are getting covered, and half are getting nothing right now.”

A major problem is that states have struggled to get up to speed with the new federal Pandemic Unemployment Assistance program, said Michele Evermore, senior researcher at the National Employment Law Project.

“A lot of people don’t understand that they’re eligible for PUA,” Evermore said. “Some states are completely denying people for regular unemployment insurance, and then inviting them to reapply for Pandemic Unemployment Assistance.”

And in many states, it’s been hard to make a regular unemployment claim in the first place. Florida has been notorious. Its antiquated computers and understaffed offices have been overwhelmed.

“I applied in the middle of the night on April 8,” said James Gamboa, 46, of Miami. Gamboa was laid off from his job tending bar poolside at a big downtown hotel in mid-March. He applied for unemployment as soon as he used up all his accrued vacation time.

“It took three to five hours to submit my claim, since I was being kicked off the website repeatedly. It took a couple weeks for it to be processed.”

Gamboa started receiving unemployment checks three weeks ago — including $600 a week in federal pandemic benefits and $278 a week in regular state benefits. But he hasn’t received checks covering the first three weeks he was unemployed, meaning he’s out about $2,700 he needs to pay rent. And his most recent check from the state hasn’t come either.

“It feels like I’m fighting an uphill battle,” Gamboa said of his efforts to reach someone at Florida’s Reemployment Assistance department, which handles unemployment claims. “When you call, you’re told that due to high call volume, the callback option is not available. Then they send you to a recording and automatically disconnect you.”

Based on the Labor Department’s most recent report of state jobless claims data, Florida has processed approximately half of the initial unemployment applications it has received since mid-March. By contrast, New York and Massachusetts have processed 70% to 90% of their claims.

COVID-19 Economy FAQs

Are states ready to roll out COVID-19 vaccines?

Claire Hannan, executive director of the nonprofit Association of Immunization Managers, which represents state health officials, said states have been making good progress in their preparations. And we could have several vaccines pretty soon. But states still need more funding, she said. Hannan doesn’t think a lack of additional funding would hold up distribution initially, but it could cause problems down the road. “It’s really worrisome that Congress may not pass funding or that there’s information circulating saying that states don’t need additional funding,” she said.

How is the service industry dealing with the return of coronavirus restrictions?

Without another round of something like the Paycheck Protection Program, which kept a lot of businesses afloat during the pandemic’s early stages, the outlook is bleak for places like restaurants. Some in the San Francisco Bay Area, for example, only got one week of indoor dining back before cases rose and restrictions went back into effect. Restaurant owners are revamping their business models in an effort to survive while waiting to see if they’ll be able to get more aid.

How are hospitals handling the nationwide surge in COVID-19 cases?

As the pandemic surges and more medical professionals themselves are coming down with COVID, nearly 1 in 5 hospitals in the country report having a critical shortage of staff, according to data from the Department of Health and Human Services. One of the knock-on effects of staff shortages is that people who have other medical needs are being asked to wait.

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