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Omicron wreaking disruption on US economy, 4th stimulus checks not expected

New Yorkers queued for Covid-19 testing in Times Square on Dec. 26, 2021, as the omicron variant continued to spread. (Reuters photo)

The American economy is getting hit as the US federal government is grappling with the Omicron variant which has prompted Covid-19 cases to surge to record levels.

This might cause US lawmakers to revisit relief strategies from earlier in the pandemic, according to CNBC.

Discussions on Capitol Hill have turned to possible aid for small businesses, restaurants, gyms and performance venues which have been hardest hit by the new wave, said Ed Mills, Washington policy analyst at Raymond James.

“The conversation has not yet been extended to assistance to individuals,” Mills said. “But it has gone from something that is not going to happen to something we have to watch.”

The country reached a record single-day record of Covid cases this week, with over 1 million new infections reported.

However, some measures of federal relief to help individuals and families, namely expanded unemployment benefits and three sets of stimulus checks, are no longer in effect.

This time around, lawmakers might not revisit the same strategies and the reason is; the pandemic has changed, and so has the American economy.

Although the early days of the pandemic resulted in high unemployment and record layoffs, that has now shifted in workers’ favor.

“With millions of job openings that are going unfilled, Congress is going to be hesitant to provide something that could be seen as being a disincentive to filling those positions,” Mills said.

The current seven-day daily average of COVID-19 cases in the US is 491,700 per day — marking a 98% increase over the previous week, according to the top federal health agency.

At a briefing on Wednesday, the US Centers for Disease Control and Prevention (CDC) Director Dr. Rochelle Walensky said the cases had spiked after the New Year holidays.

With the rapid spread of the omicron, economists have downgraded their forecasts for this year. Restaurants have seen a slowdown, and thousands of flights have been canceled. The last round of expanded child tax credit payments went out last month, and the pause on student loan payments is set to end in May after several extensions.

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