COVID & Unemployment

Pandemic unemployment benefits have kept people spending

Jasmine Garsd Jul 23, 2020
Heard on: Marketplace Morning Report
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A person fills out an unemployment benefits application. The addition of $600 a week has enabled many Americans to keep spending and support businesses. Olivier Douliery/AFP via Getty Images
COVID & Unemployment

Pandemic unemployment benefits have kept people spending

Jasmine Garsd Jul 23, 2020
A person fills out an unemployment benefits application. The addition of $600 a week has enabled many Americans to keep spending and support businesses. Olivier Douliery/AFP via Getty Images
HTML EMBED:
COPY

Chester Englander, in Ohio, is a musician for various symphonies. He has two kids and has been almost entirely out of work since March. So has his wife, also a musician.

They’ve been getting $1,200 a week in pandemic unemployment benefits.

“It’s not an exaggeration to say it kept us afloat. I mean we paid for food, we can pay our mortgage and property taxes,” he said.

Economists say pandemic unemployment has boosted the whole economy.

“If we had done nothing, we would’ve thrown tens of millions of people out of work and given them no income. So they would’ve stopped spending anywhere near as much money on groceries. They would’ve quickly gone into defaults or arrears on mortgages,” said Josh Bivens of the Economic Policy Institute.

Bivens said one sign that people have been spending their $600 a week “was the last two months of really fast job growth we saw. We had some reopening of the economy, but then we also had people who had income.”

People like Englander, who said he has saved enough to pay two months of his mortgage — and for one month of food.

COVID-19 Economy FAQs

With a slow vaccine rollout so far, how has the government changed its approach?

On Tuesday, Jan. 12, Health and Human Services Secretary Alex Azar announced changes to how the federal government is distributing vaccine doses. The CDC has expanded coronavirus vaccine eligibility to everyone 65 and older, along with people with conditions that might raise their risks of complications from COVID-19. The new approach also looks to reward those states that are the most efficient by giving them more doses, but critics say that won’t address underlying problems some states are having with vaccine rollout.

What kind of help can small businesses get right now?

A new round of Paycheck Protection Program loans recently became available for pandemic-ravaged businesses. These loans don’t have to be paid back if rules are met. Right now, loans are open for first-time applicants. And the application has to go through community banking organizations — no big banks, for now, at least. This rollout is designed to help business owners who couldn’t get a PPP loan before.

What does the hiring situation in the U.S. look like as we enter the new year?

New data on job openings and postings provide a glimpse of what to expect in the job market in the coming weeks and months. This time of year typically sees a spike in hiring and job-search activity, says Jill Chapman with Insperity, a recruiting services firm. But that kind of optimistic planning for the future isn’t really the vibe these days. Job postings have been lagging on the job search site Indeed. Listings were down about 11% in December compared to a year earlier.

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