Americans are eager to see more stimulus aid. Will they get their way soon?
Most important points
- Lawmakers have not issued stimulus checks since early 2021.
- While there are no immediate plans to send stimulus aid, things could change in the coming year.
There’s a reason Americans are desperate for stimulus help this year. Inflation has been raging since mid-2021 and has sent the cost of living soaring. For the past year and a half, consumers have had to tap into their savings and accumulate credit card debt to stay afloat — and they’re tired of it.
Unfortunately, there are no plans to issue another round of stimulus in the near term. The last round of stimulus to be approved came in March 2021 – a time when unemployment rates were still very high and the economy was on shaky ground. This year’s economy was very different. Jobs are plentiful and unemployment is low.
But there are signs that things are changing on that front. And if unemployment gets bad enough, it could still give impetus to a round of stimulus support.
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Unemployment rates are rising
For the week ending Nov. 19, new jobless claims rose to 240,000. Now, when we compare that to the number of jobless claims filed during the early stages of the pandemic, that total of 240,000 is actually quite negligible. But it does represent a big increase from the previous week, and it’s also the highest weekly total since August 13.
A number of large companies have now announced plans for layoffs. Some have even started cutting back on staff in an effort to cut costs in the run-up to a potential recession.
If unemployment continues to rise at the national level, it could argue for another round of stimulus. It could also potentially push lawmakers to increase unemployment benefits (as they did during the pandemic) so that those who become unemployed can make ends meet.
Let’s hope things don’t get any worse
Higher unemployment rates could well spur another round of stimulus in 2023. But that’s not really something people should hope for.
The unemployment rate would need to rise significantly from current levels to warrant more stimulus. And if we get to that point, it means the economy has collapsed to a level that could hurt a lot of people.
Moreover, even if the national unemployment rate is doing pick up in a meaningful way, it’s not guaranteed we’ll see another round of stimulus. Lawmakers have faced criticism for their 2021 stimulus policies, as it is believed to have contributed to the skyrocketing inflation problem. So while legislators have historically issued stimulus checks during periods of high unemployment, they may be more conservative in their approach given the backlash from the very costly 2021 US bailout.
All in all, there are signs that unemployment is on the rise. Whether that leads to more stimulus aid has yet to be determined, but it’s also a worrying sign. And so instead of waiting for a stimulus check, Americans should do what they can to reduce their spending, increase their savings, and generally strengthen their finances in case economic conditions worsen.
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