Mon, 21 Jun 2021

End of job benefits in June could mark start of U.S. recovery

Robert Besser
11 Jun 2021, 04:42 GMT+10

WASHINGTON D.C.: After nearly fourteen months of the Covid lockdown, the U.S. might take a giant step towards economic recovery in June with the end of unemployment benefits, the return of full capacity seating in bars, restaurants and sporting events, and the planned return to schools in the fall.

Also, California, the largest state economy, will end its Covid restrictions on June 15.

Further, on June 15, the U.S. Federal Reserve will begin debating how best to move from its crisis-fighting monetary policy to managing a long economic expansion.

In spite of the harm to the economy, predictions by experts point to record-breaking numbers this year, including the fastest growth of the annual gross domestic product in nearly 40 years.

To date, more than 60 percent of people 12 years and older have received at least one vaccination in the United States. Additionally, the rate of new infections and deaths has fallen, while confidence in travel and socializing has continued to increase.

However, there remains problems. In May, the United States saw 559,000 jobs being filled, which was 7.6 million short of early 2020. Also, the labor force is 3.5 million jobs smaller than pre-pandemic.

Businesses are also not expanding as expected, due to shortages of supplies, workers and raw materials.

It was noted that stimulus payments and low interest rates earlier sparked a jump in home sales prices, home construction and lumber prices. However, building material prices and other commodities have begun easing, as seen by lumber futures being down 24 percent from their peak, with copper and aluminum falling around 5 percent.

Officials note that by July 10, half the states will have stopped issuing extra unemployment benefits, while the program lapses nationwide on September 4.

June will inaugurate a "summer-boom with demand still strong and supply issues - on labor and capital - being resolved," said Gregory Daco, chief U.S. economist for Oxford Economics, as quoted by Reuters. "There is evidence of supply bottlenecks slowly easing...On the labor front, reduced virus fear, reduced benefits, better childcare, will draw people back."

More Lebanon News

Access More

Sign up for Lebanon News

a daily newsletter full of things to discuss over drinks.and the great thing is that it's on the house!