Treasury Secretary Steven Mnuchin on Thursday offered support for extending the enhanced pandemic unemployment benefit, which expires at the end of the month, but at a lower payout than the current $600 a week.
Mnuchin described the payment amount as needing a “technical fix.”
“We’re going to fix that technical fix,” he told CNBC, adding that the White House and Congress will “figure out an extension to it that works for companies and works for those people who are still unemployed.”
The $600 enhanced unemployment payment has become a political issue as Democrats would like to extend it, while Republicans oppose the idea because many recipients who receive the payment are out-earning what they made at their prior jobs.
On average, unemployment benefits across the country were $385 per week in February 2020, according to the House Ways and Means Committee. When combined with the added benefit, jobless workers receive nearly $1,000 a week. The median salary for a grocery store cashier, an essential worker, is roughly $600 a week, according to Salary.com.
Doug Rike, a 25-year-old cook who worked at the Upland Brewing Co. in Bloomington, Indiana, receives more money collecting unemployment benefits than he earned at his job.
Karen Harned, executive director of the National Federation of Independent Business’s Small Business Legal Center, recently said that a business owner angered former employees when he informed them that they were rehired.
“It was total anger, like, ‘What do you mean? We have unemployment,’” she said. “We have a number of members call us or email us and say they have offered their employees to come back, and they said, ‘No, I want to keep my unemployment.’ … We are definitely hearing stories that this is real.”
Senate Mitch McConnell, a Republican from Kentucky, has stated that he will not support extending the payment. It is unclear if his position would change if the payment was lowered.
Mnuchin on Thursday said the payment should not be above a person’s former salary when they were employed.
“You can assume that it will be no more than 100% [of the former salary],” he said. “So, yes, we want to incentivize people to go back to work. … Enhanced unemployment is intended for people who don’t have jobs. … We will not be doing it in the same way.”
In addition, he said that the administration backs another round of relief tax rebates.
“We do support another round of economic impact payments,” Mnuchin said, but he would not say whether the White House supports the payments going to those earning less than $40,000, which is what McConnell supports.
Mnuchin also suggested that the Trump administration is open to providing additional relief to state and local governments as long as it is not a bailout.
“Let me make this clear: One thing we are not going to do is we’re not going to bailout states that were mismanaged before the coronavirus. That is not the intent,” he said.
Mnuchin predicted that the Senate would pass its next coronavirus relief bill before August.
“As soon as the Senate gets back we’re going to sit down on a bipartisan basis … [and] it will be our priority to make sure between the 20th and the end of the month that we pass the next legislation,” he said.
The Senate is currently out of session, and when lawmakers return on July 20, Mnuchin said, bipartisan talks would continue on the chamber’s next relief package.
