Federal funding for extended unemployment benefits won’t go past Labor Day.

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Enhanced pandemic unemployment benefits, which include $300 weekly bonus checks as well as coverage for freelancers and the long-term unemployed, expire today. Over 11 million people will be affected, with around 7.5 million losing benefits entirely.

Some two dozen states chose to pull the plug on federal aid during the summer, with governors claiming that the extra unemployment insurance was disincentivizing residents from taking available jobs. Out-of-work residents in at least 12 states have taken legal action to try to get that pandemic relief aid reinstated, arguing that they’ve been unable to pay basic expenses, including rent. 

Meanwhile, the uptick in new delta-variant COVID-19 cases could mean new quarantine restrictions and, consequently, more layoffs. And economists have noted that the key thing holding back labor market recovery is not unemployment insurance, but rather the ongoing safety concerns related to COVID-19, as well as households struggling with family-care responsibilities. 

So who loses all coverage? Could enhanced pandemic benefits be restored? What can folks do if they need unemployment checks to make ends meet? We’ll explain below. You might also want to know about the IRS issuing refunds to those who were taxed on their 2020 unemployment benefits. And here’s an important primer on the 2021 enhanced child tax credit, which is offering millions of families extra money in advance of next year’s taxes. 

Which unemployment programs are expiring? 

At the very start of the pandemic, the March 2020 CARES Act established temporary federal unemployment aid programs. The American Rescue Plan in March 2021 extended four programs to last until Labor Day. But since Sept. 6 falls on a Monday, some recipients will be cut off this weekend. There is no grace period. 

What are those programs? The first was Federal Pandemic Unemployment Compensation, the weekly bonus — $600 per week at first, then $300 per week — that helped out-of-work Americans supplement benefits and recover some lost wages. 

Another was Pandemic Emergency Unemployment Compensation, or PEUC, which extended aid to those who exhausted their state’s benefits period (usually 26 weeks). The other was Pandemic Unemployment Assistance, or PUA, which covered self-employed workers and freelancers not typically eligible for aid. 

A later stimulus package created another program called Mixed Earners Unemployment Compensation, which offered $100 per week extra for those workers whose labor was split between being an employee and an independent contractor. 

How many will lose $300 bonus checks and other benefits? 

More than 3 million people who get the weekly $300 bonus to their state unemployment benefits will be affected. If they’re still eligible to collect state unemployment insurance (if they haven’t yet exhausted their maximum duration), they’ll continue to receive some compensation after Labor Day, but they’ll lose the $300 supplement. 

In addition, around 7.5 million people will be cut off from aid entirely when the temporary pandemic unemployment programs expire. This is considered the largest cutoff of unemployment benefits in US history. Here’s how it breaks down according to a detailed analysis of Labor Department data by the Century Foundation. 

3.3 million people covered by PEUC: This category includes workers who would have no longer been eligible to receive unemployment because they passed their state’s benefit window (most provide 26 weeks, with some granting as few as 12 weeks and others as many as 30 weeks). The program provided up to 53 weeks of additional aid for those who exceeded state allowances.4.2 million people covered by PUA: This category includes workers who do not qualify for any form of federal or state unemployment compensation. It covers freelancers, gig workers, independent contractors and part-time workers. During the pandemic, the program also supported those who couldn’t work because they were taking care of a dependent. 

That’s not the full picture of everyone affected by unemployment. Reported jobless rates generally don’t account for those who have left the labor force entirely and are no longer counted as looking for work, such as the long-term unemployed. 

Those at a major disadvantage are workers in frontline industries, especially Black workers, whose current unemployment rate is around 10%. Also, women have been particularly hit (PDF) by COVID-related job losses, and were heavily responsible for taking care of children or family members during the pandemic. 

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Why did benefits get cut early, and where they were reinstated?

Citing labor shortages in the spring, 26 state governors had said pandemic-related unemployment benefits were producing limited incentives for workers to take jobs. Many economists and analysts disagreed, highlighting several factors that have prevented people from finding suitable work, including low wages, lack of child care and fear of contracting COVID-19. With unemployment claims still fluctuating as the economy struggles to return to pre-pandemic “normalcy,” reports are showing that the early cancellation of the federal programs had little impact on labor markets. 

According to an August report by the Century Foundation’s Andrew Stettner, “Politics, not economics, drove the attack on unemployment insurance.” A recent JP Morgan Chase Institute study (PDF) confirmed that in states that prematurely ended supplemental unemployment insurance programs in June and July, there’s little indication that their labor markets improved afterward.

The states that cut off the enhanced benefits before the federal expiration on Sept 6. were: Alabama, Alaska, Arizona, Florida, Georgia, Idaho, Iowa, Louisiana, Mississippi, Missouri, Montana, Nebraska, New Hampshire, North Dakota, Ohio, Oklahoma, South Carolina, South Dakota, Tennessee, Texas, Utah, West Virginia and Wyoming. 

Arkansas, Indiana and Maryland were slated to cut off benefits early, but successful lawsuits forced those states to preserve the federal coverage, at least temporarily. In issuing their rulings, judges noted that the ending of benefits made it harder for the unemployed to afford basic needs. Lawsuits were also filed against state governors elsewhere, like in Oklahoma and Tennessee, but those cases are still held up in the courts. Similar lawsuits to restore aid in Louisiana, Florida, Ohio and West Virginia were denied by judges.

Some states, including Arizona, Montana and New Hampshire, started offering financial incentives for individuals to find work. Other states, such as Colorado and Connecticut, continued the unemployment programs but offered their own new-job bonuses. Since each state has different requirements, check to see if there are signing bonuses where you live.

With the economy still recovering, the end of pandemic unemployment can feel like a trap for millions without an income. 

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Could pandemic benefits be extended?

White House officials have indicated they will not continue the enhanced jobless benefits past the Labor Day cutoff, saying they were intended to be temporary. When states began pulling out of pandemic-era unemployment programs, Labor Department officials said their hands were tied and that they couldn’t counter decisions by governors. 

According to an Aug. 19 letter by Labor and Treasury Department officials, states can use $350 billion of pandemic funds that Congress allocated in the American Rescue Plan to continue paying unemployed workers. The letter says that in areas where unemployment remains high, “it may make sense for unemployed workers to continue receiving additional assistance for a longer period of time,” which would allow those individuals to find a job. It’s not clear at this time which states will choose to use any leftover pandemic funds to continue jobless benefits.

Is it too late to apply for unemployment insurance? 

If you’ve been laid off or furloughed, you can apply for unemployment benefits in your state. Once the state approves your claim, you can apply to receive whatever state benefits you’re entitled to. Because states cover 30% to 50% of a person’s wages, there isn’t a single sum you could expect on a national basis. Each state’s unemployment insurance office provides information to file a claim with the program in the state where you worked. Some claims may be filed in person, by phone or online, so it’s best to contact your state’s office directly.

Eligibility criteria vary from state to state, but the general rule is that you should apply if you’ve lost your job or been laid off through no fault of your own, including if it was due directly or indirectly to the pandemic. You can check on your state’s requirements here. In February, the Department of Labor updated its unemployment eligibility requirements to include people who refused to return to work due to unsafe coronavirus standards.

As for self-employed workers and freelancers who are losing PUA coverage, some online groups are calling to extend pandemic unemployment programs through the crisis and offer more information. 

We’ll continue to update this story as we receive more information.

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