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American’s are Opting Out of Unemployment Benefits

More than two dozen states are opting out of federal Unemployment Benefits early, meaning nearly 4 million Americans will see their benefits reduced or cut entirely. Monthly payments of the child tax credit, scheduled to start July 15, may offer a financial lifeline to parents who lose unemployment advantages and have trouble finding a job or can’t yet return to work.

Households eligible for the credit will get up to $300 a month per child under age 6 and $250 for older kids under 18. Meanwhile, states are withdrawing from unemployment programs anytime from June 12 through July 10. According to the U.S. Census Bureau’s Household Pulse Survey, 48% of households receiving Unemployment Benefits also have kids under age 18.

Heidi Shierholz, director of policy at the Economic Policy Institute, a progressive think tank, and former chief economist at the Department of Labor said that this will help. For most families, it will be just a fraction of what they’re losing. Twenty-five states have announced their intent to pull out of pandemic-era programs that give recipients an extra $300 a week in Unemployment Benefits. Most are also ending aid for the self-employed, gig workers and the long-term unemployed, generally defined as those out of work for more than six months.

Alaska, Iowa, Mississippi and Missouri are ending that aid on June 12, the earliest among the states. Arizona, the last, will do so on July 10. The American Rescue Plan offers those federal benefits until Sept. 6. According to an analysis of Labor Department data, The average person received roughly $2,500 a month in total unemployment advantages in April. The analysis includes the $300 weekly federal supplement.

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