The nation’s unemployed received some good news last week. Those who qualify for the additional $300 in weekly federal unemployment benefits under the Lost Wages Assistance program (LWA) may receive up to six weeks worth of benefits. (Projections are based on current spending rates in individual states along with Department of Labor and state calculations.) That’s potentially twice as long as the initially announced three weeks. Put another way, it’s up to $1800 in additional payouts rather than the previously promised $900.
The program, announced by President Trump in early August, was designed to follow the first round of stimulus, known as the CARES Act. That legislation added $600 in weekly unemployment insurance payments from the federal government to whatever individual states provided. Those payments eased the economic effects of the coronavirus pandemic. They ran out at the end of July, and Congress remains deadlocked on a second round of stimulus.
It’s been a slow roll-out for the LWA, which could access up to $44 billion through FEMA’s Disaster Relief Fund. Nevada, approved Friday, was the last of the 50 states to be approved for the FEMA grant. South Dakota is the only state to turn down the additional funds. The District of Columbia and Guam were also approved. As of the second Monday in September, the unemployed in only 25 states have received some or all of their benefits.
Many states may not reach that six-week limit however. As of last Thursday, FEMA had already handed out $30 billion of the available $44 billion. Arizona, Massachusetts, Missouri, Montana and Texas have already reached their six-week limit. Colorado, New Jersey, New York, and Pennsylvania are among the 25 states yet to receive any payments.
So why is this program taking so long to get moving? While the federal government is putting up the money, state governments have to distribute it through their individual unemployment systems. Many of those systems rely on old software running on an even older coding language. Making seemingly simple changes to distribute an additional $300 per week takes weeks of valuable time.
The nation’s unemployed added over 1.6 million new applicants for the week connecting August and September, the most recent week for which numbers are available. That includes 838,916 new filers for Pandemic Unemployment Assistance and 857,148 filers for standard unemployment. As of August 22nd, over 29 million Americans were collecting unemployment. The jobless numbers remain historically high, as they have been since the early days of the pandemic.