- More than 36 million Americans have applied for unemployment insurance since the coronavirus wrecked havoc on the economy
- State insurance systems have struggled to keep up with demand, leaving millions of Americans without pay for weeks.
- As the systems try to catch up, focus will turn to state trust funds that could run out before the end of the year.
More than 36 million Americans have applied for unemployment benefits since the coronavirus crippled the U.S. economy.
The federal government has stepped in and has promised to pay all jobless claimants, including independent contractors, an additional $600 until July 31. However, the rollout and the sheer volume caused by the economic shutdown have been anything but smooth. The surge in joblessness has caused a backlog, exposed dated computer systems and made phone lines near impossible to reach.
"I called about 1,000 times this past week, and I haven't gotten through at all," said Casey Sellers, 23, a computer-aided design drafter from Michigan. He was laid off in late March.
According to the Pew Research Center, about 29% of unemployed Americans received benefits in March. That number is improving but many states have a long way to go. In Florida, as of Tuesday, 36% of applicants had been insured and in Michigan around 92% have been approved or received benefits. As states continue to catch up, their trust funds will also get depleted.
"If we don't pass underlying unemployment insurance reforms soon, states are going to spend all of their trust funds. Once states have to borrow from the federal government, there will be a lot of pressure coming out of this recession to cut benefits further to make up for the shortfall. And I'm just terrified that states are going to completely decimate their unemployment insurance systems after this," said Michele Evermore, senior policy analyst at National Employment Law Project.
During the Great Recession, 36 states borrowed money from the federal government. According to experts, many will likely do so again.