As extra jobless benefits end, millions of Americans struggle to afford food
With emergency unemployment aid set to expire this week, a growing number of Americans are struggling to put food on the table. Nearly 30 million people were sometimes or often unable to get enough to eat last week, according to a Census Bureau survey.
Such "food insecurity," which shot up 24% last month, from about 23 million people, could become even more prevalent throughout the U.S. when the extra $600 in weekly jobless benefits the federal government provided to out-of-work adults, under the Coronavirus Aid, Relief and Economic Security Act, lapses on Friday. That means about 25 million people could see a sharp drop in their income, as the nation grapples with the highest jobless rate since World War II.
One worker facing that drop in unemployment benefits is Lindsay Reynolds, 27, who was furloughed from her events and marketing job at an Orlando, Florida, theme park in April. She said her weekly jobless aid will drop to $247 a week, from almost $800 a week, when the enhanced benefits come to an end.
"I would not be able to afford rent, my student loans, utilities and everyday expenses like food," Reynolds said. She has applied to more than 20 jobs, but either received no response or received a rejection, and now plans on moving back with her parents temporarily to ride out the crisis.
"My parents are like, 'Come home,' and they will pay for groceries," Reynolds said. "There really are too many people unemployed and not enough work for people to do."
Without an extension of federal benefits — including the extra unemployment pay and boosting of food-stamp benefits — poverty in the U.S. will rise to 11.9% by the end of 2020, according to a new forecast from the Urban Institute. That's about a third higher than the projected rate of poverty if the current government policies are extended, the centrist think tank found.
Americans who live with someone who has lost a job could suffer even greater hardship, with Urban projecting that about 1 in 7 such households will experience poverty by year-end. Meanwhile, the recent rise in food insecurity tracked by the Census underscores the fragility of the economy as lawmakers debate how much additional jobless aid to extend beyond July 31.
"The government should be there to help us. We all pay taxes, and we didn't imagine something like that happening," Reynolds said, adding that the future "is terrifying."
Of the more than 29 million Americans who reported food insecurity last week, about 4 in 10 were millennials like Reynolds, representing the largest share of any age group. About 60% of millennials — people between the ages of 25 and 39 — have seen their income drop since the pandemic slammed the U.S. in March, the Census survey found.
Millennials represent roughly a quarter of the American population. Along with coping with the health and economic impact of COVID-19, many young adults also face greater financial burdens than previous generations, such as heavy student loans and higher housing costs.
Off a cliff
Millions of Americans could tumble off an "income cliff," as experts have dubbed the expiration of emergency federal relief and moratoriums on evictions, just as the nascent economic recovery is sputtering, according to Josh Bivens, director of research at the left-leaning Economic Policy Institute.
A new government report shows that the nation's gross domestic product — the broadest measure of economic growth — plunged a record-breaking 32.9% between April and June. That shattered the previous record quarterly drop in GDP, a 10% decline in 1958.
"Even if this early bounceback had persisted in July, it would've needed substantial fiscal aid from Congress to continue," Bivens wrote in a blog post. "The fact that this bounceback has almost certainly stalled means this aid is even more necessary," including the extra $600 in weekly jobless aid.
While some measure of additional unemployment aid is likely to be rolled out to jobless Americans in coming weeks, Congress continues to haggle over how much. Republican lawmakers have proposed $200 a week in extra benefits, while Democrats are pushing to keep the payments at $600.
Given that lawmakers haven't yet passed the next economic stimulus bill, jobless workers will likely have a gap of at least two weeks until the new pandemic relief efforts reaches their households, although unemployment experts warn the wait could be even longer.
