Trump $300 in jobless aid: Only 5 states so far are paying benefits
On August 8, President Donald Trump said his executive order to provide an additional $400 in weekly jobless aid to the nation's 26.3 million unemployed workers would provide "immediate" relief. But almost three weeks after he signed the order, only five states so far are paying out the federal portion of the extra benefits, which amounts to $300.
Those states are Arizona, Louisiana, Missouri, Tennessee and Texas, according to tracking site UnemploymentPUA.com, which received confirmation from those states' unemployment offices or residents who supplied evidence of payment. Texas was one of the first states, along with Arizona, to begin paying claims this month, according to a spokesperson for the Texas Workforce Commission.
Dozens of additional states have been approved for the extra jobless aid, which is disbursed from $44 billion in disaster relief funds through FEMA. States must apply to FEMA for the funding, and then set up their systems to distribute the aid to their jobless residents, which can require up to six weeks to reach applicants.
The slow rollout of the program is causing mounting stress for millions of jobless workers who are struggling after their extra $600 in weekly jobless aid came to an end last month. And Mr. Trump's original promise to provide $400 in weekly aid is falling short, given that the federal government is supplying only $300 per week, with the hope that states would pony up the additional $100 in extra pay per jobless applicant.
So far, only four states — Kentucky, Montana, Vermont and West Virginia — have said they'll shell out the extra $100 in jobless benefits. That means the vast majority of jobless workers will receive only $300 per week, rather than the $400 promised by Mr. Trump.
"I don't think it's effective," Andrew Stettner, senior fellow at The Century Foundation and an expert on unemployment benefits, said of Mr. Trump's Lost Wages Assistance program. "It's not something people can count on to meet regular expenses, like sending their kids back to college, paying rent or buying groceries."
Waiting until October?
Jobless workers in many states might have to wait until the end of September or even October for their $300 in extra aid, Stettner added. That's likely also true for the states that have yet to apply for the aid from FEMA, which is overseeing the disbursement of $44 billion in disaster relief funds that were directed to pay for the extra jobless aid.
Take residents in Nevada, which in July had the nation's third-highest unemployment rate, at 14%, after New York and Massachusetts. Nevada on Tuesday said it would apply for Mr. Trump's Lost Wages Assistance program, but added that it could take as long as six weeks after FEMA approves its application for jobless workers to receive the payments.
Even if FEMA approves Nevada's grant immediately, it could take until early October for jobless workers to see the benefits land in their bank accounts.
Only three weeks of aid through Mr. Trump's Lost Wages Assistance program has been greenlit by FEMA. And with natural disasters such as Hurricane Laura taking a toll on the nation, the agency may have additional demands for that pot of disaster funding.
"We are just getting to the height of hurricane season," a former FEMA official told CBS MoneyWatch. "If these storms are catastrophic, the added financial strain of the emergency unemployment aid means money will be spent quickly, and Congress will have to find a way to get these funds back."
32 states approved
So far, 32 states have been approved for the aid by FEMA. They are: Alabama, Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Georgia, Idaho, Indiana, Iowa, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Mississippi, Missouri, Montana, New Hampshire, New Mexico, New York, North Carolina, Oklahoma, Pennsylvania, Rhode Island, Tennessee, Texas, Utah, Vermont and Washington.
Already, there are signs of consumer stress from the loss of $600 in extra unemployment aid last month. Those benefits, directed by the Coronavirus Aid, Relief, and Economic Security Act, or CARES Act, provided income worth $1.2 trillion on an annualized basis, according to Oxford Economics. Without that aid, personal income will decline 5%, or below pre-pandemic levels, its economists said last month.
In a conference call last week, Walmart U.S. CEO John Furner said he believes consumers are feeling more cautious about job security and overall. That jibes with an unexpected plunge in consumer confidence this month as the pandemic wears on and more than 1 million new applicants every week seek jobless aid.
Expect more pain ahead, economists are warning.
"President Donald Trump's executive orders are providing even less relief to households than initially expected in the absence of a more comprehensive fiscal aid package," Oxford Economics Lead Economist Nancy Vanden Houten said in a research note. "The steep decline in federal support for unemployed workers and heightened uncertainty will depress consumer confidence and spending."
