With over 30 million unemployment applications submitted as of last week, some states have already spent more in unemployment benefits in these two months than they had for all of 2019.
It took a little over a year after the start of the Great Recession for states to dip into the FUA, whereas these nine states could find themselves borrowing from the account just two months after the start of the pandemic."The federal government will almost certainly need to replenish its own fund because it does not currently have sufficient reserves to pay out all of these claims," Walczak told ABC News.
California has already tapped into $1.4 billion of the $4 billion it was allotted from the FUA for the month of May, according to the U.S. Department of Treasury.Those currently receiving unemployment benefits, along with those who apply in the foreseeable future, will continue to receive a check -- regardless of whether the FUA runs dry, according to Walczak.
The U.S. Department of Treasury will automatically move to replenish FUA funds when the account is depleted, according to Andrew Stettner, senior fellow at the Century Foundation. Signage is displayed on a closed New York State Department of Labor building in Queens, N.Y. on April 14, 2020. Stettner said future claimants could see less money in weekly benefit checks and they may even get fewer weeks of benefits than previous recipients.
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