At least 1 million people might not get the extra $400 in unemployment benefits passed by President Donald Trump.
A specific requirement under Trump’s executive order is projected to disproportionately exclude female, low-wage and part-time workers, CNBC reported.
The true figure could be even higher than 1 million, the outlet continued.
“That would leave many of the roughly 30 million Americans collecting unemployment benefits from the ranks of those receiving additional aid, just as financial relief measures for renters, homeowners and small businesses expired and jobless claims remain high,” CNBC wrote.
The president announced on August 8 several executive orders aimed at providing relief for those struggling during the pandemic — including an additional $400 per week in extra unemployment benefits.
The unemployment boost — a 33% cut from the $600 provided by the CARES Act — most likely won’t be seen for a few weeks, according to Forbes.
Some legal experts question whether Trump can use executive power to extend unemployment benefits, and there could be a court challenge. That’s because the Constitution gives authority for funding to Congress.
Here’s what you need to know:
Recipients Must Be Getting at Least $100 in Weekly State Unemployment Benefits
To be eligible for the extra $400, recipients must be receiving at least $100 per week in state unemployment, CNBC reported.
A majority of states offer a weekly minimum “far below that threshold” though, the outlet continued.
An analysis by Ernie Tedeschi, an economist at Evercore ISI, indicated that roughly 3% — or 1 million — of out-of-work Americans get less than $100 a week, CNBC reported.
Eliza Forsythe, a labor economist and assistant professor at the University of Illinois at Urbana-Champaign, told the outlet she predicts the number will be closer to 6%.
She also expressed that those left out will primarily be low-wage, part-time and female workers.
“It’s hitting people who were already vulnerable and low-income before this job loss,” Forsythe said.
CNBC noted that Forsythe’s analysis did not account for workers receiving partial benefits due to a slash in hours.
Some States Might Not Be Able to Afford Participating
Trump’s order calls for the federal government to cover only 75% of the unemployment benefit, leaving the states to fill the remaining $100 per week, according to Forbes.
The states will have to dip into their allocations of the Coronavirus Relief Fund, which was created by the CARES Act, the outlet added.
Many governors are currently facing budget pressures thanks to expenses from “containing coronavirus coupled with a reduction in tax revenues,” Forbes said.
California Governor Gavin Newsom told ABC 7 that the state funding mandated by the unemployment order is unattainable.
“There is no money sitting in the piggy bank of the previous CARES Act to be reprioritized or reconstituted for this purpose,” he said to the station. “Simply, it does not exist.”
The new round of benefits is projected to cost California an estimated $700 million a week, ABC 7 added.
Experts Say the Benefits Will Run Out Quickly
Experts estimate that the money in the Homeland Security’s Disaster Relief Fund, leveraged under Trump’s order, will only last “four to five weeks before expiring,” Forbes reported.
The president’s order states that the additional benefits will be available “for eligible claimants until the balance of the DRF reaches $25 billion or for weeks of unemployment ending not later than December 6, 2020, whichever occurs first, at which time the lost wages assistance program shall terminate,” Forbes said.
The Fund currently has $70 billion available, the outlet added.