WASHINGTON, D.C. – The U.S. economy slipped further into recession as nearly 1.2 million more Americans joined the unemployment ranks this week — marking the 20th week in a row over a million workers filed initial claims for jobless benefits. The news comes as enhanced unemployment benefits under the CARES Act – a critical lifeline for millions of struggling families during the pandemic — were allowed to expire last week following the Senate’s refusal to consider a House-passed relief package that included a full extension of the $600 benefit.
And while 23 million Americans are now under threat of eviction and more families turn to food banks for the first time in their lives, President Trump’s Senate allies are wasting more time – after hitting the “pause” button in May — arguing amongst themselves over a “sweet spot” for how deeply to cut the extra benefits.
“For the twentieth week in a row over a million Americans filed new unemployment claims, and yet Trump’s Senate allies are acting like the economy is humming again,” said Kyle Herrig, president of Accountable.US. “Families across America are already feeling the painful consequences of Congress’ inaction on unemployment benefits. The economy remains in freefall and it won’t be fixed until the public health crisis is properly addressed. Congress needs to get its priorities in line and immediately advance a relief package that puts workers — not big businesses and Trump allies — first.”
Making matters worse, with only two days left before Trump’s Paycheck Protection Program is set to expire, Congress has yet to put forth a relief bill that includes enhanced transparency measures to combat the abuse, fraud, and failures of the program’s first iteration – failures that allowed over 110,000 small businesses to shutter, especially in communities of color.
WHERE TO START ON THE ROAD TO RECOVERY: In addition to immediately extending the CARES Act’s enhanced $600 unemployment benefits, Congress must turn the page on the Small Business Administration’s poorly designed and managed program. Rather than repeating the Trump administration’s mistakes, any new effort to help small businesses must be transparent, data-driven, and aligned with the needs of the communities that need help the most.
It’s Clear More — Not Less — Needs to Be Done as The Trump Recession Gets Worse for Millions of Americans:
- Wall Street Journal, 8/5: Lapse in Extra Unemployment Benefits to Hurt U.S. Recovery, Economists Say. If the payments aren’t reinstated, it could end up costing the economy 1.1 million jobs by the end of the year, boost the unemployment rate by 0.7 percentage point and reduce gross domestic product by 1.27%.
- CNBC, 8/5: Millions of Americans will struggle to pay their bills by end of August without the extra $600 unemployment insurance. Without that money, 44% of those currently collecting UI benefits will now receive less than $800 per month.
- CNN, 8/4: Black-owned companies are shutting down twice as fast as other businesses. The report estimates that 41% of Black-owned businesses across the country shut down between February and April.
- Associated Press, 8/4: Wave of evictions expected as moratoriums end in many states. The federal eviction moratorium that protects more than 12 million renters living in federally subsidized apartments or units with federally backed mortgages expired July 25.
- Washington Post, 8/4: For the unemployed, rising grocery prices stretch budgets even more. The cost of groceries has been rising at the fastest pace in decades since the coronavirus pandemic seized the U.S. economy.
- New York Times, 8/3: One-Third of New York’s Small Businesses May Be Gone Forever. When the pandemic eventually subsides, roughly one-third of the city’s 240,000 small businesses may never reopen… So far, those businesses have shed 520,000 jobs.