AOC to introduce bill extending unemployment aid after benefits expired for millions

Jobless aid for more than 7.5 million people expired on Labor Day

US Rep Alexandria Ocasio-Cortez will file legislation to extend federal pandemic unemployment relief through early 2022 after benefits expired for millions of Americans in September.

“I’ve been very disappointed on both sides of the aisle that we’ve just allowed pandemic unemployment assistance to completely lapse, when we are clearly not fully recovered from the cost effects of the pandemic,” she said during her monthly town hall with constituents on 14 September, according to a statement from her office.

“I simply just could not allow this to happen without at least trying,” she said.

The legislation proposes extending all federal unemployment aid through 1 February, 2022, retroactive to 8 September. A suite of Covid-19-related jobless assistance expired for more than 7.5 million people on Labor Day.

That day, three programs lapsed – one provided an additional $300 in weekly federal unemployment aid, another provided relief to jobless Americans who did not otherwise qualify, and another extended federal aid for those who exhausted state-level benefits.

President Joe Biden has suggested that states should allocate other relief funds to continue to float unemployment aid, but state lawmakers do not appear prepared to do so, and Congress and the White House have not signalled any readiness to revive aid in the middle of the pandemic and its economic fallout.

A key component of now-lapsed federal assistance included a weekly supplement to state jobless benefits, initially adding $600 a week from April through July 2020, then, after it was revived in December, dropping to $300 a week.

Congress also created two other programmes – the Pandemic Unemployment Assistance programme supported independent contractors and self-employed Americans, while the Pandemic Emergency Unemployment Compensation extended jobless aid to people who exhausted their state benefits.

More than 9 million people were receiving benefits from the Pandemic Emergency Unemployment Compensation programme or Pandemic Unemployment Assistance programme, and roughly 100,000 others filed an initial claim for the latter programme within the last week of August, according to the Bureau of Labor Statistics.

Enhanced unemployment aid lifted 5.5 million Americans out of poverty, according to the US Census Bureau. Direct stimulus payments lifted 5.5 million people out of poverty, the agency found in its latest report.

When factoring in those benefits, the nation’s poverty rate declined by 2.6 per cent from 2019 to 9.1 per cent in 2020, the lowest rate since since 2009, when the agency began accounting for impacts from all government aid in its annual poverty assessment.

A report from the US Department of Agriculture also suggest that pandemic relief helped stave off a larger hunger crisis in 2020, while mass unemployment in the wake of the pandemic’s onset acutely impacted Black households, families with children and people in the South.

The report found that 10.5 per cent of all American households were food insecure, or nearly 14 million households – overall rates that remained unchanged from 2019.

The end of Covid-19-related unemployment aid follows the loss of benefits for nearly 3 million Americans who were cut off from some or all unemployment aid across half of all US states – all but one governed by Republicans – in a bid to push residents back to work earlier this summer.

Analysts have argued that cutting off those benefits did not lead to an uptick in hires.

For every eight workers who lost their unemployment aid, only one found a job.

More than 3 million people were also not employed because of health concerns, without adequate or consistent safety measures in place against Covid-19 transmission, while 5.5 million others were caring for children who are not in school or enrolled in daycare, according to a recent survey from the US Census Bureau.

The unemployment aid cliff “could not come at a worse time,” said Rakeen Mabud, chief economist at Groundwork Collaborative. “Millions will suffer as they lose this critical source of income and the loss of spending will suppress job growth, setting us back yet again in our efforts for an inclusive and equitable recovery.”