The Biden administration has sought a way to keep paying increased unemployment benefits to an estimated 3.5 million Americans who will soon be losing in Republican-led states, but Labor Department officials believe that the law does not allow this.
With federal intervention now unlikely, unemployed Americans in at least 22 states, including Arizona, Ohio, and Texas, are projected to cut their payments by $ 300 a week – or be completely wiped out – as GOP governors seek that Pushing people back to work in response to a possible national labor shortage.
In the past two weeks, a number of Republican governors have decided to end one or more of the programs contained in the historic federal expansion of the unemployment system. They cited labor shortages and the improving economy as reasons for their decisions.
The increased payments, which Congress first approved in its massive coronavirus relief plan in March 2020 and extended twice, are preventing Americans from returning to the job market, governors say. At least four states offer return to work bonuses instead.
The threat of cuts has worried the Biden government and its democratic allies. Any labor shortage is the result of Americans’ continued concerns about their safety, a refusal to accept low wages, or an inability to leave home due to inadequate childcare. But federal officials have come to believe they may not be able to prevent Republican governors from acting, according to two people briefed on the matter and speaking on condition of anonymity to describe private deliberations.
The Department of Labor generally cannot force GOP leaders to pay federal stimulus payments under a national unemployment system that gives states ample scope to implement their own systems at their own discretion. Neither can federal agencies bypass Republicans by running unemployment controls themselves or cooperating in other states, according to those familiar with their thinking.
Even if the Department of Labor had the authority, the agency would likely face significant legal, logistical, and technological hurdles in distributing aid quickly – a complex task involving a network of technology and staff that, despite decades of experience, confuses many government agencies brought.
The financial burden could be the toughest for around 2.7 million workers who are at risk of their benefits being completely canceled, the data shows. This includes Americans who have been unemployed for so long that they have exhausted government grants, as well as those who are self-employed and participate in a program known as Pandemic Unemployment Assistance (PUA).
The numbers are likely to change in the coming weeks as new applicants apply for benefits and existing recipients find new jobs. About 444,000 Americans filed initial claims for unemployment insurance last week, the Department of Labor reported Thursday. The number was the lowest number of filings since March 14, 2020, and prompted White House officials to announce the country’s rapid recovery from one of the worst crises since the Great Depression.
In a speech last week, President Joe Biden said laid-off Americans must return to work if they are offered suitable jobs, but stressed that because of the more generous federal payments, he doesn’t see much evidence of people staying at home. “The people who say Americans don’t work even if they find a good and fair opportunity underestimate the American people,” he said.