Unemployment benefits may decline or end for thousands in Washington state

Thousands of Washingtonians could see their unemployment benefits decline or disappear entirely unless Congress makes changes to pandemic relief programs, state officials warned this week. 

One program alone, known as Pandemic Unemployment Assistance (PUA), which currently provides benefits to roughly 100,000 people, expires at the end of December.

Without congressional action, workers who depend on PUA benefits “pretty much fall off a cliff,” said state Sen. Karen Keiser (D-Des Moines), chair of the Labor & Commerce Committee. “It’s infuriating.”

Changes in other federal programs, meanwhile, will reduce the number of weeks of extra benefits for some workers who have exhausted their standard benefits. 

The looming changes aren’t a surprise. They’ve been widely discussed since Congress enacted pandemic relief under the CARES Act in March. 

But officials in Washington and other states had hoped Congress would have extended the CARES Act by now. Instead, congressional negotiations bogged down.

The growing anxieties over federal relief come amid mixed news about the state’s job market. 

Washingtonians filed 16,837 new, or initial, claims for regular unemployment benefits last week, the state Employment Security Department (ESD) reported Thursday. That’s a 33.2% drop from week before — although claims reported for that prior week were inflated by federal rules requiring some existing claimants to file new claims. 

Nationally, new unemployment claims tallied 742,000, a 4.4% increase over the prior week, the Labor Department reported Thursday.

The number of Washingtonians collecting unemployment benefits last week was 276,049 — up 1.7% from a week earlier, the ESD reported.

The ESD also reported a decline in the state’s unemployment rate for October, to 6.0%, compared with an adjusted rate of 8.3% in September.

But that encouraging trend may change with new restrictions to curb COVID-19 cases, announced by Gov. Inslee on Sunday, which are expected to lead to more layoffs.

“Upward revisions to the data [on job growth] in recent months show a stronger recovery, but renewed restrictions on business operations in response to mounting virus risk put the recovery in jeopardy,” said ESD state economist Paul Turek in a statement.

Further, the state’s declining unemployment rate has had a negative side effect: less federal benefits.

During the pandemic, many workers have been able to get extra benefits under several federal programs.  But the number of extra weeks is tied to the state’s unemployment rate. When it fell below 8%, the number of extra weeks available to Washingtonians declined by seven.

That’s especially bad news for workers covered under PUA. The program was created for workers, such as contractors and the self-employed, who don’t typically qualify for regular state unemployment. In October, roughly 112,000 people collected benefits under the PUA program in Washington, the ESD said.

Earlier in the pandemic, PUA claimants were entitled to a total of 46 weeks of benefits roughly similar to regular unemployment benefits. But with the lower unemployment rate, PUA now only offers 39 weeks of benefits (the change goes into effect Nov. 22.)

That means the bulk of PUA beneficiaries, who began filing claims in March, will see their benefits end over the next several weeks, and some have already run out of PUA benefits, said ESD spokesperson Nick Demerice. 

Making matters worse for PUA claimants, they aren’t eligible for the 13 weeks of extended benefits (previously 20 weeks) that are offered to workers in the regular unemployment program. So, while many regular unemployment claimants can count on extended benefits well into next year, PUA beneficiaries have no such options.

Even those PUA claimants who filed for benefits later in the year — and who, technically, still have plenty of additional weeks left — can’t use them past Dec. 31, Demerice said. “The program was only authorized through the end of the year,” he said. 

As the end of the year has approached without any action from Congress, Washington state officials have been exploring ways to replace some of those disappearing federal dollars with state funds.

But the near-term options are limited, given that “we already have a billion-dollar hole in our budget,” said Gov. Jay Inslee during Sunday’s news conference about the new COVID-19 restrictions.

State lawmakers are proposing legislation that would increase the minimum benefits paid to unemployed workers, among other changes, but those measures wouldn’t take effect until next year, Keiser said. 

That means the only real solution will come from Congress. Encouragingly, the approaching deadlines appear to be spurring some congressional leaders to call for a restart of relief negotiations. “So, hopefully, there’s movement there,” Demerice said.