The $600 weekly enhanced unemployment benefits jobless Americans are currently receiving are set to expire on July 31.
The benefits were part of the CARES Act stimulus package that passed in March and gave qualified taxpayers $1,200 stimulus checks and qualified jobless workers an extra $600 a week in unemployment insurance benefits.
Last month, the Democrat-controlled House passed another $3 trillion stimulus package, known as the HEROES Act, that would extend the additional unemployment payments until January 2021. The package isn’t expected to advance in the Republican-controlled Senate.
Now the Trump administration has come out opposed to extending the $600 weekly enhanced payments past the July 31st deadline.
While speaking to the Senate Finance Committee, Labor Secretary Eugene Scalia said the initial implementation of the $600 weekly benefits “was the right thing to do,” but believes it won’t be needed going forward as the country begins to reopen and recover, reported the AP.
“We expect the economy to be deep into the process of reopening, with shutdown orders ended and millions of Americans freed to return to work,'' Scalia said of the country’s outlook by the end of July.
“The circumstances that originally called for the $600 plus-up will have changed,'' Scalia added. "Policy will need to change as well.''
Scalia didn't elaborate as to what that policy may look like.
On Friday, data from the Labor Department revealed an unexpected rise in jobs in May, suggesting that the weeks-long economic drag caused by the coronavirus pandemic is slowing down.
The data showed that employment rose by 2.5 million last month, bringing the jobless rate down to 13.3%, from 14.7% in April.
After the release of the job report, Senator Mitch McConnell issued a statement downplaying the need for a new massive stimulus package.
“As Senate Republicans have made clear for weeks, future efforts must be laser-focused on helping schools reopen safely in the fall, helping American workers continue to get back on the job, and helping employers reopen and grow,” the Senate majority leader said.
Some economists fear that prematurely ending federal aid could stymie the country’s economic recovery in the wake of coronavirus.
“This is … like stopping an antibiotic prematurely because you start to feel better,” Ernie Tedeschi, an economist who served in the Obama administration, told the Washington Post. “If we let support expire too soon, we could have a double-dip downturn.”
While the unemployment rate is expected to remain in the mid-teens through July, there have been no official negotiations on another stimulus package, reported the Associated Press.