- The U.S. has seen a record number of unemployment claims in recent weeks due to the coronavirus.
- The $2 trillion stimulus package passed in March calls for a $600 increase in weekly unemployment benefits.
- Unemployment benefit payouts vary by state, but a video helps provide a rough framework for how the weekly payout amount is calculated.
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As the coronavirus pandemic started sweeping across the country in March, all non-essential businesses closed up shop and millions of people found themselves stuck at home without a job. In turn, unemployment claims in the United States quickly reached historic levels. During the last week of March, the number of unemployment applications reached 6.9 million. As a point of contrast, unemployment applications hovered around the 210,000 mark this past January.
Though the volume of unemployment claims has dropped off in recent weeks, it’s still at a historically high level. In short, a large percentage of the U.S. workforce is without work, and there’s no indication as to when the economy might return to a fraction of its previous strength.
In light of the current economic environment, the $2.1 trillion stimulus package passed this past March includes provisions that call for higher unemployment payouts. The payouts, it’s worth pointing out, do vary on a state-by-state basis but many people have already been receiving an additional $600 a week. What’s more, the new unemployment guidelines encompass more individuals, which is to say that part-time workers and individuals who are self-employed can file for unemployment benefits as well. It’s worth noting that the bump-up in weekly benefits will only last through July 31.
To help make sense of the new unemployment payouts, CNBC put together a video that highlights how unemployment benefits are calculated for someone in New York making $40,000 a year. Assuming a steady income of $10,000 per quarter, that figure is then divided by 26 which represents how many weeks unemployment benefits can be claimed. Doing the math nets us $384 in weekly benefits. The additional $600, though, bumps that up to $984 a month.
The full video can be seen below:
Again, weekly payouts are adjusted on a state-by-state basis. And while most states have weekly payouts in the $400 to $600 range, there are certainly outliers on both sides of that range. A list of unemployment payouts for each state can be seen here. Incidentally, the states with the highest payouts include Massachusetts, Hawaii, and Washington. The states with the lowest weekly payouts include Louisiana, Alabama, and Arizona.
You should also note that unemployment benefits are taxable, so you’ll want to put some money aside every week just to be safe. Incidentally, some states give you the option to have money taken out of your unemployment check automatically and put aside for tax purposes.