Pa., N.J. workers set to lose the extra $600 in unemployment benefits this week

Dylan DeSimine has been out of work since March, when the coronavirus pandemic dried up his free-lance sports broadcast business. With local professional and college sports events largely postponed or using fewer staff, the Mount Laurel cameraman has relied on unemployment benefits to stay afloat, including the extra $600 a week in federal assistance.

But DeSimine’s last $600 in extra help could come this week, cutting his income in half. The Federal Pandemic Unemployment Compensation, created by Congress in March as part of a $2.2 trillion coronavirus rescue package, is set to expire at the end of the month. That would affect hundreds of thousands of people in both Pennsylvania and New Jersey who receive the enhanced benefit.

For DeSimine, it would leave him with just enough money to pay rent and bills, dashing any hopes of saving for a home with his girlfriend.

“I didn’t ask to be out of work and I haven’t enjoyed a second of it,” said DeSimine, 26. “The pandemic is not over. The pandemic assistance package cannot just end like this.”

With no end in sight to the pandemic, Washington lawmakers are at odds over how to give more financial help to Americans. Democrats want to extend the full $600 enhanced unemployment benefit, while Republicans say that amount is too much, as some have earned more on unemployment than they did at work. Lawmakers are also weighing another round of direct stimulus payments, a payroll tax cut, and other measures to help the struggling economy.

Failure to pass something would deal a “body blow” to the economy, said Mark Zandi, chief economist at Moody’s Analytics. Companies continue to lay off workers at high levels and 17.3 million people nationwide were receiving unemployment benefits as of July 11. Cutting off financial help now would cause consumers to slash spending and force many to stop paying bills, plunging the economy back into a recession, he said. But scaled-back unemployment benefits along with other relief, such as a stimulus check, should be enough to keep things together, he added.

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“Hard-pressed households have no financial cushion at all. Zero. They have no savings, they have no financial resources,” Zandi said. “So if they don’t get a check next week, then they are going to stop spending next week. And they’re going to go into panic mode immediately, even before the bills come due.”

As of July 11, 795,000 New Jersey workers were receiving the extra $600 in federal help, according to the state Department of Labor and Workforce Development.

The Pennsylvania Department of Labor & Industry said Tuesday that it could not provide an exact number of recipients. On Monday, Susan Dickinson, the department’s director of unemployment compensation benefits policy, said the state has about 3.3 million claims between regular and Pandemic Unemployment Assistance right now, and said most of those likely received at least one $600 payment.

Although the federal program expires July 31, this is the final claim week for the additional $600 payments. Both state agencies said workers who are owed unemployment benefits for previous weeks will still receive the extra $600 for those weeks, too, even if payment is issued after the program expires.

The $600 federal unemployment benefit has provided billions to Pennsylvania and New Jersey jobless workers. Since March 15, Pennsylvania has distributed $13.5 billion under the program, compared with $11 billion in regular unemployment, L&I Secretary Jerry Oleksiak said Monday. As of last week, New Jersey paid out $6.5 billion in the federal benefit, compared with nearly $3.3 billion in regular unemployment.

Pennsylvania officials reminded workers of other programs offering help when the extra payments end, such as Medicaid, the Supplemental Nutrition Assistance Program (formerly called food stamps), and the Low-Income Home Energy Assistance Program. The department is holding an online town hall meeting Thursday from 1 to 2 p.m. to answer questions from the public. The livestream will be available at https://access.live/PAlabor.

Some economists argue that the extra $600 was too generous and had discouraged people from going back to work. Because jobless workers receive the full $600 regardless of their previous earnings, many have earned more on unemployment than they did on the job, according to the authors of a recent report published by the University of Chicago. The report cited the President’s Council of Economic Advisers, which estimated that 64% of workers would receive more income from unemployment benefits than from working until the end of July.

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The Democrat-controlled House passed a $3 trillion relief package in May that would extend the $600-a-week addition to unemployment benefits through January. GOP lawmakers are reportedly considering a $1 trillion proposal that would replace the $600 weekly jobless benefit with a lower amount, so the unemployed don’t get more aid than they would through a normal paycheck.

“I want to be very careful about any spending that I think is going to delay our economic recovery or weaken our economy overall,” U.S. Sen. Pat Toomey (R., Pa.) said last week.

Danielle Bartolucci, 23, from Philadelphia, has received the weekly $600 payments after being laid off by a catering company. She’s still worked part time at a Fairmount bar, but said she won’t make enough to pay rent and bills if she can’t find another job when the $600 a week goes away.

“Luckily, I saved a little extra so I should be good for maybe two months,” she said. “But my rent is just a big portion every month, so I’m definitely not making rent with what I’m making right now.”

Staff writer Chris Brennan contributed to this article, which also contains information from the Associated Press .