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- The Labor Department reported false counts of weekly unemployment benefit claims and several states underpaid unemployed Americans thanks to a key economic relief program, the Government Accountability Office said Monday.
- Inconsistent state data, backlog of claims and potential fraud in the benefit system have resulted in “erroneous week-to-week comparisons” of unemployment claim data, the government watchdog said.
- Average weekly payments under the Unemployment Pandemic Assistance Program fell below the poverty line in 29 of the 41 states reporting data, the agency added. While some states have made the minimum payments first and plan to repay the remaining totals, it’s unclear when the process can be completed.
- The GAO report warns that the economic fallout from the virus may be greater than first thought and that most states are not providing the immediate relief allocated by Congress.
- Visit the Business Insider homepage for more stories.
The Department of Labor’s weekly unemployment insurance deposit tally has reflected inaccurate data throughout the pandemic, and unemployed Americans are underpaid through the benefits program, the Government Accountability Office said on Monday .
The historic number of unemployed Americans claiming benefits has skewed weekly claims numbers for months, the government watchdog said in its report. Inconsistent state data, backlog of claims and potential fraud in the benefit system have resulted in “erroneous week-to-week comparisons of total claims,” GAO added.
Additionally, a program to provide benefits to workers who lost their jobs due to the pandemic underpaid beneficiaries in most states. Some states have paid minimum amounts first and aim to pay off the rest of the receivables from beneficiaries once new tax information is taken into account. Yet average weekly payments under the Pandemic Unemployment Assistance Program in September fell below the poverty line in 29 of the 41 states that reported data, GAO said.
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“The expiration of additional payments for UI recipients may mean that some household income no longer exceeds poverty guidelines,” the watchdog said. “Additionally, with the expected expiration of some CARES Act benefits in December 2020, PUA applicants who remain unemployed may face additional hardships.”
The report details terrible missteps in tallying and paying unemployed Americans as the coronavirus crisis rages on. Cases continue to skyrocket in the United States, and economic indicators suggest the pace of the recovery weakened during the fall, with states reinstating partial lockdowns.
About 9.1 million people were receiving PUA benefits in the week that ended Nov. 7, more than the number of people receiving regular state benefits. That works out to about 8.7 million in the week ended October 31.
GAO’s finding that most states underpaid PUA recipients indicates that millions of Americans endured the pandemic recession with less government assistance than was allocated by Congress.
The PUA and an extension of regular benefits are set to expire at the end of the year, putting the unemployed even more at risk throughout the recession. Congress reconvened on Monday for a brief session in which it could adopt new budget support. President Donald Trump and President-elect Joe Biden have backed large-scale stimulus packages, but lawmakers remain worlds apart when it comes to the price. Senate Republicans led by Mitch McConnell have pushed for a $ 500 billion fundraising package, but House Democrats continue to support the $ 2.2 trillion Heroes Act they passed in early October.
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Even though GAO warns of backlogs of claims, unemployment benefits remain high. Claims for unemployment benefits in the week ending Nov. 21 stood at 778,000, the Labor Department said on Wednesday. The reading topped the economist’s estimate of 730,000 and marked the first consecutive jump in claims since July.
Although the number of weekly claims has fallen significantly from the March high of nearly 7 million, it is still well above the 665,000 seen in the worst week of the Great Recession.
To be sure, the GAO noted that repeatedly counting Americans who filed multiple claims could have resulted in inflated counts. The agency recommended that the Labor Department note in its weekly report that the numbers “do not accurately estimate” the number of unique Americans claiming benefits. The GAO also recommended that the ministry “pursue options” that more accurately track the exact number of Americans receiving benefits.
The Department of Labor agreed with the first recommendation and partly with the second. The ministry disagreed that it should retroactively report the number of distinct people claiming UI benefits, in part because state programs may have difficulty updating its requirements. reports. Still, the GAO noted that the department should attempt to revise its previous reports “because they are critical to understanding how many people are receiving unemployment insurance benefits.”
“Without accurate accounting of the number of people who depend on the benefits of the user interface and the real-time PUA as close as possible, policymakers could be challenged to respond to the current crisis,” the dog said. on call.
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