As the White House lauds falling unemployment claims, a former Obama economist says benefits must stay in place to ensure a full recovery

Now Hiring man with mask
A man wearing a mask walks past a “now hiring” sign on Melrose Avenue amid the coronavirus pandemic on April 22, 2021 in Los Angeles, California.

  • Jobless claims just dipped again, reaching a new pandemic-era low.
  • The White House is lauding signs of recovery, but prematurely ending unemployment could hurt that.
  • One economic expert said that ending benefits now would hurt both workers and recovery prospects.
  • See more stories on Insider’s business page.

Thursday brought two big numbers for the American economy: Another significant rise in inflation, and the lowest level of weekly jobless claims since the onset of the pandemic.

They show the paradox that is the current economic recovery. Goods are still getting pricier – although inflation shows signs of cooling down soon – and fewer people are losing work and remaining on unemployment. The White House says its recovery plan is working.

In a statement, Brian Deese, the director of the National Economic Council, said the recent economic data “reinforce that US fiscal policy and vaccination progress are positioning the economy for growth and job creation.” Deese also noted that the jobless claims come “as independent analysts project that economic growth in the United States will outpace growth for our peer nations and reach the fastest pace in nearly four decades.”

On Wednesday, a day ahead of the jobless data release, Heidi Shierholz, the director of policy at the left-leaning Economic Policy Institute and an Obama Labor Department veteran, broadly agreed with Deese.

“Things are getting back to normal,” Shierholz told Insider. “I think the key is we don’t want to make drastic policy changes at this point.” When it comes to relief and recovery measures for this recession, “we are doing it so right,” she said. But she warned that could still change.

Shierholz said she expects to see a quick bounceback and strong recovery, but changing course could threaten that. “If we start pulling back with those measures now, we’re going to just cut that off at the knees,” she said.

One thing that could weaken the recovery is the move to prematurely end federal unemployment benefits in 25 states, where GOP governors cited labor shortages as a reason to pull the plug on benefits and get workers back. Both the jobless claims and May’s jobs report show the recovery happening even with enhanced benefits. As Insider’s Ayelet Sheffey reported, payrolls saw a strong increase even as benefits remained intact.

The decision to prematurely end unemployment benefits will impact about 4 million workers, according to an estimate from Andrew Stettner at the liberal-leaning Century Foundation. Some of those workers, who receive benefits through federal programs that expanded both the eligibility and duration of benefits, will lose all benefits – not just the additional $300 weekly.

Some advocates and politicians have argued that the Labor Department is legally required to continue to pay out Pandemic Unemployment Assistance (PUA), which expanded eligibility for benefits to gig workers, among others. However, the Department of Labor has concluded it’s probably unable to pay those out.

The White House has signaled acceptance for benefits ending. Last week, White House Press Secretary Jen Psaki said the GOP-led states that are cutting off benefits “have every right” to do so.

Shierholz said many people that have been unable to find work or are unable to return due to health concerns. Cutting off benefits would also cut off the money those people have been spending in the economy.

“Cutting them off too early deeply unnecessarily increases human suffering,” she said. “It also weakens the recovery.”

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A petition urging the government to give $2,000 monthly stimulus checks to every American has surpassed 2 million signatures

protest stimulus
Protesters rally demanding economic relief during the coronavirus pandemic in New York City on August 5, 2020.

  • A petition calling for $2,000 monthly stimulus checks has reached more than 2 million signatures.
  • The petition argues the three stimulus checks released over the course of a year have not been sufficient to deal with the financial repercussions brought on by the pandemic.
  • Senate Democrats have been urging both Congress to pass recurring relief checks to stave off financial difficulty.
  • See more stories on Insider’s business page.

More than 2 million people have so far signed a petition calling for monthly stimulus checks in the amount of $2,000 to support Americans as the pandemic continues.

The petition, which was first posted on last year, was started by Colorado restaurant owner Stephanie Bonin.

“I’m calling on Congress to support families with a $2,000 payment for adults and a $1,000 payment for kids immediately, and continuing regular checks for the duration of the crisis,” Bonin wrote on the petition. “Otherwise, laid-off workers, furloughed workers, the self-employed, and workers dealing with reduced hours will struggle to pay their rent or put food on the table.”

In the petition, Bonin urges Congress to issue “immediate checks and recurring payments.”

“Congress needs to make sure that we won’t be financially ruined for doing our part to keep the country healthy,” she wrote.

There have been three rounds of stimulus checks in the last 15 months since the onset of the pandemic.

The last stimulus check was passed under President Joe Biden in the amount of $1,400 to eligible Americans. Congress has been slow to issue stimulus checks because of partisan disagreements between Republicans and Democrats. Each party has had different visions of the amount allocated per check and other relief measures the overall spending package would include.

The Trump administration issued two stimulus checks – the first in the amount of $1,200 and the second in the amount of $600. Nine months passed between both rounds.

Bonin criticized the amount of time it took Congress to come to an agreement.

“Another single check won’t solve our problems – people are just too far behind,” Bonin wrote on the petition. “Like we’ve been saying from the beginning of this pandemic, people need to know when the next check is coming. And the best thing our government can do right now is send emergency money to the people on a monthly basis.”

Bonin’s petition has garnered so much support that recognized it in its list of top 10 petitions that changed 2020.

Senate Democrats have been urging both Congress and the Biden administration to pass recurring relief checks to help stave off the financial devastation brought on by the coronavirus.

“Supplying Americans with monthly support until they can get back on their feet can save our communities from financial ruin,” Bonin wrote.

Read the original article on Business Insider