Million More in Poverty Since May as Aid Dries Up

Marco Green
October 17, 2020

While the number of people collecting unemployment and continuing claims have declined, theses declines represent people who have reached the maximum duration of payments available through their state unemployment program and are now receiving benefits from the federal government, according to the Wall Street Journal. And those benefits are set to expire at the end of 2020.

After an ambitious expansion of the safety net in the spring saved millions of people from poverty, the aid is now largely exhausted, and poverty has returned to levels higher than before the coronavirus crisis, two new studies have found.

Using a different definition of poverty, a separate report from researchers from the University of Chicago and Notre Dame University found that poverty has grown by 6 million in the last three months, the Times said. Columbia University researchers found that the number of poor people in the U.S. actually fell in the early months of the crisis, when the $2 trillion Cares Act provided $1,200 stimulus checks and an extra $600 a week in unemployment benefits, but the gains were reversed as aid dried up, causing 8 million people to fall into poverty since May, reports the New York Times. "They tell us people are having a lot more trouble paying their bills, paying their rent, putting food on the table".

Needless to say it is not easy to survive in the USA nowadays with only 2,854 dollars monthly, and this may help explain why we see so many people falling out of the middle class in recent years, the publication said.

The broadest measure of unemployment insurance - which includes those actually being paid under the regular state UI, the Federal Pandemic Unemployment Assistance, the state Extended Benefits and the federal Pandemic Emergency Unemployment Compensation (PEUC) - fell by 215,000 for the week ending September 26.

Significantly, the studies differ on the most recent month: While the Columbia model shows an improvement in September, the Chicago and Notre Dame analysts found poverty continued to grow. "Black people and Latinos are more than twice as likely as white people to be poor", according to the studies.

But unemployment applications rose in 17 other states.

Other reports by Click Lancashire

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