New Report from The Century Foundation: 11.4 Million Workers Facing Jobless Benefit Cliff Starting March 14

Wednesday, February 10, 2021

New Report from The Century Foundation: 11.4 Million Workers Facing Jobless Benefit Cliff Starting March 14

Unless Congress acts swiftly, 11.4 million workers will lose their unemployment benefits between March 14 and April 11 of this year, with disastrous results for families and the American economy. American workers faced a similar benefits cliff just this past December, when, according to research by The Century Foundation, 12 million workers were at risk of seeing their federal unemployment benefits expired on December 26 of that year; 1 thankfully, Congress was able to include the Continued Assistance for Unemployed Workers (CAUW) Act in their end-of-the-year stimulus package, maintaining critical CARES Act programs—Pandemic Emergency Unemployment Compensation (PEUC), Pandemic Unemployment Compensation (PUC), and Pandemic Unemployment Assistance (PUA)—until at least March 14, 2021, with some benefit payments continuing up to April 11. 2

But the expiration of this new tranche of benefits is rapidly approaching. With negotiators hemmed in by a $900 billion cap in aid, the CAUW Act included the shortest period of benefits passed by Congress since the 1980s, 3 and this latest extension is winding down almost as soon as it started.

Based on our analysis, we estimate that just twelve states will be triggered onto the federal Extended Benefits (EB) program at the end of the “soft cliff” on April 11, 2021—meaning that, after that date, only roughly 700,000 jobless workers will be able to receive any UI benefits after temporary federal UI programs expire. On a net basis, this means that more workers will face the cliff in March and April than did on December 26 due to the limited availability of EB.

In what appears to be a good sign for American workers, Congress and the White House seem to be marching in lockstep toward relief based on President Biden’s American Rescue plan, as the Senate has passed a special budget reconciliation vote to be able to enact such a package with only 51 votes.4 As expressed by President Biden himself, the expiration of unemployment benefits is driving the urgency of action.5 While the COVID-19 vaccination program has started in earnest, it is not widespread enough to allow for broad-scale re-opening of the economy, and thus the millions of jobless workers who are currently relying on unemployment benefits will need more aid before they are rehired. The situation is especially dire for the 39.5 percent of the unemployed who have now been out of work for six months or more,6 with finances badly stressed and savings depleted.

The jobless benefits passed in the December stimulus package are responsible for lifting more than 7 million Americans out of poverty in January,7 but Americans will need strong unemployment benefits to be in place through at least the end of September if they are to weather the storm of the pandemic. And not only do these benefits assist families, but the inclusion of a $400 per week boost in benefits—as proposed in President Biden’s American Rescue Plan (up from $300 in the CAUW Act)—presents an efficient way for Congress to target aid to those families who will spend it quickly, providing a quick boost to the national economy to help it out of the major hole left by the pandemic in 2020...8