Nearly 12 million jobless Americans would lose federal benefits the day after Christmas unless Congress passes extensions for key unemployment programs, according to a new analysis.
Currently there are two active key government programs authorized by the Coronavirus Aid, Relief, and Economic Security Act, or CARES Act, but both expire on December 26.
One program is the Pandemic Unemployment Assistance program, which provides unemployment aid to freelance and gig workers.
If it expires, 7.3 million workers would lose their benefits, according to a study by The Century Foundation, a progressive think tank.
The other program is Pandemic Emergency Unemployment Compensation (PEUC), which, if expires, would deprive 4.6 million workers of their needed income, the study shows.
“Absent congressional action to extend CARES Act benefits, December 26 will mark the end of one of the last lifelines available to millions of Americans in desperate need,” said Andrew Stettner, who co-authored the study with Elizabeth Pancotti. “It will be a crippling end to one of our darkest years.”
The study projected that 2.9 million will be able to continue receiving benefits from state-level programs called Extended Benefits, but that will require that states pitch in to cover half the costs in 2021.
The expiration of the programs will leave millions without any unemployment benefits, which only cover a fraction of prior income.
Another program, which added $600 a week to unemployment checks across the board, expired at the end of July.
"People don't realize that most of the people collecting unemployment benefits now will be cut off on December 26," Stettner said. "Most people will be going from that $200 to $300 a week to nothing."
"This is will have a huge impact on families and the economy."
Meanwhile, several other pandemic-related programs will expire at year-end. For instance, a moratorium on evictions and a program to provide forbearance on mortgages are also due to expire by the end of 2020.
The end of aid programs would provide a "real test" for the economy, according to Oxford Economics senior economist Bob Schwartz.
"With infection rates spiking throughout most of the nation, so too are more restrictions being put in place, setting the stage for the unemployment lines to swell again," Schwartz wrote in a report. "Unless Congress extends [jobless benefits], a vital source of income for this distressed segment of the population would be extinguished."
The coronavirus pandemic, which hit in March, has left millions of Americans unemployed and many more could lose jobs as COVID-19 surges across the US, sparking new restrictions from states and cities.
The unbridled spike in recent weeks has brought new caseloads to over 150,000 a day on average.