Next coronavirus relief bill could include changes to unemployment benefits, Hassett says
Roughly two-thirds of workers on unemployment are receiving more from the government aid than they earned at their old job
Doug Flynn of Flynn Zito Capital Management on a new report from the Congressional Budget Office projecting a 10-year economic recovery from the coronavirus.
President Trump is meeting with his senior economic team this week to explore policy options for the next coronavirus relief package, which could include reforms to unemployment benefits, according to White House adviser Kevin Hassett.
The $2.2 trillion CARES Act expanded benefits for unemployed Americans by an extra $600 per week through the end of July; however, Republicans have increasingly expressed concern that the money is actually discouraging workers from returning to their jobs.
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"We are absolutely meeting this week," Hassett told FOX Business' Maria Bartiromo. "We are going over what we think will be in the phase four deal, and we're going to try to reform unemployment insurance so that the factor you suggested goes away."
Roughly two-thirds of workers on unemployment are receiving more from the government aid than they earned at their old job, according to a recent paper written by economists at the University of Chicago's Becker Friedman Institute. The Federal Reserve's Beige Book, released last week, found that business owners have struggled to bring workers back as a result of the sweetened benefits.
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Once the $600-per-week expires at the end of July, the typical unemployment check, which varies by state, will return to below $400 per week.
It's unclear what specific proposals the White House plans to pursue. Larry Kudlow, Trump's chief economic adviser, previously endorsed a back-to-work bonus for unemployed Americans returning to their jobs.
"We've got to reward individuals for coming back to work," Kudlow said during a "Fox & Friends" interview on Friday. "There will be some kind of re-employment bonus. We're not going to go to the $600, that's a disincentive to work."
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One such proposal from Sen. Rob Portman, R-Ohio, would provide $450 weekly to laid-off Americans returning to work, in addition to their wages. The money would last through July 31, the same date on which the extra unemployment benefit expires. Another, introduced by Texas Rep. Kevin Brady, the top Republican on the House Ways and Means Committee, would give workers a one-time payment of $1,200, or two weekly payments of $600 when they go back to their job.
Other proposals the White House is mulling include a payroll tax cut; liability protections for businesses and tax deductions or write-offs for individuals who take a vacation, a senior administration official told FOX Business' Blake Burman on Tuesday.
More than 40 million Americans have lost their jobs as a result of the coronavirus-induced economic shutdown, a rate unseen since the Great Depression. The nation's unemployment rate surged to 14.7 percent in April, and likely ballooned to at least 20 percent in May.