President Trump’s effort to replace a portion of the now-expired $600 per week in supplemental unemployment benefits has produced lots of questions about the size and scope of the program. Following considerable pushback on the plan from state officials, the White House provided some clarifications on Tuesday:
- Although Trump on Saturday said the plan would provide $400 per week for qualified unemployed workers, the White House said on Tuesday that the weekly aid would top out at $300 per week.
- Reversing a previously stated requirement that states contribute 25%, or $100, toward the enhanced payment, the White House said Tuesday that there was no requirement for states to cover a portion of the cost.
The clarifications – which clearly involve last-minute rule changes, with White House National Economic Council Director Larry Kudlow saying, “We modified slightly the mechanics of the deal” – mean that the Trump plan would replace about half of the lost federal unemployment payments, which will drop from $600 per week to $300.
Questions remain: It’s not clear how long it will take the payments to arrive, or if all states will participate in the program. The money, which is being drawn from $44 billion in unused disaster relief funds, will not flow through existing state unemployment systems, since it’s technically “lost wages assistance” and not unemployment insurance. Instead, states are required to set up new payment systems, a process that could take weeks or months and further stress already overwhelmed employment offices. Given that the funds are limited, some states may opt not to participate, since the program could run of money in just a few weeks
While Kudlow said Tuesday that it would take “about two weeks” for people to start receiving aid, Eliza Forsythe, a labor economist and assistant professor at the University of Illinois at Urbana-Champaign, told CNBC that, “It’s not something that’s going to be quick. I don’t think anybody knows how long it will take, but it’s certainly not something any unemployed person can count on within a few weeks.”
In addition, it’s not clear how many unemployed workers would actually qualify for the program. Some low wage workers may not qualify, depending on how states implement their programs. And Forsythe estimates that nearly a third of self-employed workers who received payments through the enhanced benefits program would be ineligible for the new program.