Some of the unemployment benefits that have been going to millions of people amid the pandemic expire Friday, which experts say will have a major ripple effect on the economy.
“Seventy percent of the economic growth in this economy is consumer spending, so if you cut that money you are going to make it even worse," Peter Cohan of Babson College said.
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With the U.S. Senate in recess until Monday as negotiations over a new relief package remain at a stalemate on Capitol Hill, it appears there won’t be any deal until at least next week on whether to reinstate the $600 unemployment checks, an expanded benefit.
Alexandra Rosin, a physical therapist who lost her job in March, said that extra $600 has been critical.
"It’s getting to the point where I feel useless," Rosin said. "I can’t sit in my apartment any longer. I want to be employed so badly.”
Massachusetts hit a new record of first time unemployment claims last week with more than 19,000 filings, 1,000 more than the week before.
Meanwhile, the U.S. economy plunged by a dizzying 32.9 percent, with unemployment surging to nearly 15 percent. The government’s estimate of the second-quarter fall in the gross domestic product was the sharpest such drop on records dating to 1947.