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Unemployment recipients fell by more than half after Labor Day cliff


At a SoFi Stadium Job Fair on September 9th, 2021, Inglewood, California, people receive information.

PATRICK FALLON | AFP | Getty Images

After the Labor Day “cliff”, when federal assistance was ended for millions, more than half of Americans were receiving unemployment benefits.

There were just over 5 million people receiving jobless aid as of Sept. 11 — a roughly 55% cut from the 11.3 million who’d been collecting benefits the week prior, according to federal dataPubliated Thursday

Labor Day was the last day of all pandemic-era income support programs to unemployed.

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The federal programs had been open since March 2020, but at that point, long-term and self-employed workers were not eligible.

In the coming weeks, however, it is expected that there will be a drop in number of recipients who are still receiving federal aid. The 5 million ongoing recipients as of Sept. 11 includes about 2 million people who, on paper, received federal aid through lapsed programs — a dynamic that reflects processing delays and backdated applications, according to labor experts.

Individuals who are not working but still qualify for state benefits may continue to receive this aid. Due to the expiration a federal supplement, these individuals are now receiving $300 per week less.

Congress extended federal benefits programs twice in February 2021 and December 2020, but decided not to extend them a third-time due to an improved economy and labor market.

To encourage beneficiaries to get back to work, 26 states opt out of these programs before the deadline. However, available evidence suggestsHigh-quality benefits did not keep many workers from taking part in the program.

Other factors such as continuing health risk and caregiving responsibilities are also important to any workers shortage, according to economists.

Janet Yellen (Treasury Secretary), and Marty Walsh (Labor Secretary) were both present urgedStates with high unemployment rates will continue to provide assistance to unemployed workers through other pots of federally-allocated pandemic funds. They have not, however.

Mike Robinson
Mike covers the financial, utilities and biotechnology sectors for Street Register. He has been writing about investment and personal finance topics for almost 12 years. Mike has an MBA in Finance from Wake Forest University.