Mary Taboniar went without a paycheck for 15 months thanks to the COVID pandemic. As a housekeeper at the Hilton Hawaiian Village Resort in Honolulu, the single mother of two saw her income disappear completely when the virus ravaged the hospitality industry.
For more than a year, Taboniar relied entirely on increased unemployment benefits and a network of local food banks to support her family. Even this summer, when the vaccine rollout hit and tourists began to travel again, their jobs were slow to return, reaching 11 days in August – about half their pre-pandemic workload.
Taboniar is one of millions of Americans for whom Labor Day 2021 is a dangerous crossroads. Two main anchors of the government’s COVID protection package are ending or have recently ended. As of Monday, an estimated 8.9 million people will lose all unemployment benefits. A federal eviction moratorium has expired.
While other aspects of pandemic relief, including rental benefits and the expanded child tax credit, are still prevalent, millions of Americans will face Labor Day with a suddenly shrunk social safety net.
“This will be twice the hardship,” said Jamie Contreras, secretary-treasurer of SEIU, a union that represents administrators in office buildings and catering workers at airports. “We are far from finished. People still need help. … Nothing has changed for millions of people compared to a year and a half ago. ”
For Taboniar, 43, this means that her unemployment benefit ceases to exist – even if her working hours disappear again. A recent surge in virus caused the governor of Hawaii to recommend vacationers postpone their plans.
“It really scares me,” she said. “How can I pay rent if I am not unemployed and my job is not back?”
She plans to apply for the newly expanded SNAP aid program, better known as grocery stamps, but she doubts that it will be enough to make up the difference. “I just reach for anything,” she said.
President Joe Biden’s administration believes the US economy is strong enough not to be bogged down by evictions or cuts in unemployment benefits. Officials claim other elements of the safety net like the child tax credit and the SNAP program (which Biden permanently topped up earlier this summer) are enough to smooth things over. On Friday, a White House spokesman said there were no plans to reassess the end of unemployment benefits.
“Twenty-two trillion dollar economies work in no small part on the dynamics, and we have strong dynamics that are going in the right direction on behalf of American workers,” said Jared Bernstein, White House economics advisor.
Labor Secretary Marty Walsh said he believed the country’s workforce was ready for the shift.
“Overall, the economy is moving forward and recovering,” Walsh said in an interview. “I think the American economy and American workers are better positioned for Labor Day 2021 than they are for Labor Day 2020.”
Walsh and others point out encouraging digit numbers; on Friday the unemployment rate had fallen to a healthy 5.2%. But Andrew Stettler, a senior fellow at the Century Foundation, a left-wing think tank, says the end of extended unemployment benefits is coming too soon.
Learn about the history of Labor Day and how it became the celebration it is today.
Instead of setting an arbitrary deadline, according to Stettler, the government should have linked the end of the protective measures to certain indicators for economic recovery. He suggests three consecutive months with nationwide unemployment below 5% as a reasonable benchmark to trigger the end of unemployment benefit.
“This seems to be the wrong political decision based on our location,” said Stettler.
Ending these safeguards during the economic crisis could have a devastating impact on lower-middle-class families who barely survived the pandemic. It will potentially become “more difficult for millions of people to find their lost place in the middle class,” said Stettler.
Biden and the Democrats who control Congress are at a crossroads and are phasing out aid as they instead focus on its wider package of infrastructure and other “better reconstruction” spending. The $ 3.5 trillion proposal would rebuild many of the safety net programs, but it faces hurdles in the narrowly divided Congress.
The COVID-19 response has been sweeping in size and scope, roughly $ 5 trillion in federal spending since the virus outbreak in 2020, an unprecedented endeavor.
Republicans in Congress had backed some of the initial COVID-19 spending but voted against Biden’s $ 1.9 trillion recovery package earlier this year as unnecessary. Many argued against extending another round of unemployment benefits, and Republicans vowed to oppose Biden’s $ 3.5 trillion package, which lawmakers are expected to consider later this month.
There are still several ways to provide assistance, although in some cases actually providing that assistance has been problematic.
Countries with higher unemployment can benefit from $ 350 billion in aid.
Federal rental support funds remain available even though the money has been slow to come in, so the White House and lawmakers pushed state and local officials to distribute the funds faster to both landlords and tenants.
While post-pandemic demand for homes coupled with low supply caused prices to spike, not all are reaping the benefits. Millions of homeowners have been lenient and many tenants are struggling to pay rent as the evictions expire this summer. It is a “race” to pass further aid measures, says Chris Herbert of the Harvard Joint Center for Housing Studies.
Investment bank Morgan Stanley on Thursday estimated the economy will grow at an annual rate of 2.9% in the third quarter, well below its previous forecast of 6.5%. This decline largely reflects a decline in government aid spending and bottlenecks in the supply chain.
And the economy still faces hurdles. Union officials say sectors like hotel housekeepers and office janitors have been the slowest to recover.
“Our industry is at the forefront when it comes to COVID,” said D. Taylor, president of UNITE HERE, a union that represents hotel housekeepers – an area “mostly occupied by women and people of color.”
Many of these housekeepers never returned to full employment even as Americans began traveling again and hotel occupancy increased over the summer.
Taylor said several major hotel chains have moved to permanently cut labor costs by reducing service levels under the guise of COVID. Taboniar’s Hotel in Hawaii, for example, has switched to cleaning the rooms every five days, unless the guest specifically requests otherwise. Even though the hotel was over 90% busy in August, she was only busy half of her usual pre-pandemic days.
The delta variant of the coronavirus also poses a challenge that threatens future school closings and the delay in plans to return workers to their offices.
Walsh called the Delta variant “an asterisk on everything”.
The sudden loss of a vital element of the pandemic safety net has fueled calls for a reassessment of the entire unemployment benefit system. Senator Ron Wyden, D-Ore., The chairman of the finance committee, said in an interview that it was critical that Congress modernize the unemployment insurance system as part of the package.
“It’s heartbreaking to know it didn’t have to be that way,” said Wyden.
One of the changes he is proposing is to tie unemployment benefits more closely to economic conditions so that they do not expire in times of need. “We have to bring the unemployment system into the 21st century,” he said.
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Associated Press Writer Josh Boak contributed to this report.
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