Federal Pandemic Unemployment Benefits Expired

The federal pandemic unemployment benefits program expired on Monday (September 6). The expanded benefits were part of the CARES Act to provide relief to Americans who were forced out of work because of the coronavirus pandemic.

The expanded programs cost an estimated $800 billion and provided an additional $300 weekly payment on top of state benefits, and allowed gig workers to qualify for unemployment benefits. The program also provided relief to people who had exhausted their regular state unemployment benefits.

An estimated 7.5 million people will be affected, and an additional 2.1 million will lose the $300-weekly payment.

The programs were expanded twice, first in December 2020 and then again the following March.

There are currently a record ten million job openings in the country, but some economists do not expect hiring to increase now that the expanded unemployment benefits have ended. They pointed to the slow pace of hiring in July and August after several states terminated the programs early.

"Our earlier research failed to find large effects of ending the programs in jobless claims data, and alt-data indicators such as OpenTable dining and Google searches for 'jobs' as a measure of job search effort," JPMorgan economists Peter McCrory and Daniel Silver wrote in a note. "July employment growth does not seem to have been impacted by the changes to the unemployment insurance programs," they added. "There is essentially zero correlation between state-level employment growth in July and the time between the end of expanded UI benefits and the survey reference week."