(NEXSTAR) – While the IRS continues to send out weekly additional stimulus checks as part of the third round of Economic Impact Payments, many Americans are wondering if a fourth wave of COVID relief is possible.
The latest round of stimulus checks as part of President Joe Biden’s $1.9 trillion American Rescue Plan have provided more than $385 billion in $1,400 payments to eligible recipients. Pandemic relief payments of $1,200 and $600 were included in the first two stimulus packages.
When asked directly about stimulus checks last week, White House press secretary Jen Psaki responded by saying, “We’ll see what members of Congress propose,” adding that the payments “were not free.”
On Monday, Biden announced that his administration will be sending relief checks to thousands of restaurants, but it remains unclear how likely a fourth stimulus check to Americans might be. “Today, we’re sending out the first relief checks to 16,000 hard-hit restaurants with help for many more to follow,” Biden said. “A lot more people are going to be employed.”
While Republicans lawmakers have largely opposed relief checks, some Democrats and research groups have called on the president to push for not only a fourth check but ongoing payments until the end of the COVID-19 pandemic. “One year of stimulus checks lifted Americans out of poverty during the pandemic,” nonprofit Economic Security Project tweeted last month. “As it turns out, direct cash payments do indeed work.”
The nonprofit’s argument for continued payments centers around the utility of the cash infusion, which it credits with lifting millions out of poverty. The group’s data project that the $1,400 stimulus checks, child tax credit and other benefits in the American Rescue Plan will bring 16 million Americans out of poverty, with a fourth and fifth check lifting 12 million more from poverty.
Whether or not a fourth round of stimulus checks can find traction in Washington will depend on how the country recovers from the devastating effects of the pandemic. While public health experts and scientists told The New York Times last week that herd immunity in the U.S. is unlikely to ever happen, there are signs of a rapidly strengthening economic rebound.
Employers struggle to fill open positions
U.S. businesses are looking to hire and ramp up production, but are running into shortages of both employees and raw materials. The recovery of America’s job market hit a pause last month as many businesses — from restaurants and hotels to factories and construction companies — struggled to find enough workers to catch up with a rapidly strengthening economic rebound.
Employers added just 266,000 jobs in April, sharply lower than in March and far fewer than economists had expected. With viral cases declining and states and localities easing restrictions, the recovery from the pandemic recession has been so fast that many businesses have been caught flat-footed in the face of surging consumer demand.
Last month’s hiring slowdown appears to reflect a host of factors. Nearly 3 million people are reluctant to look for work because they fear catching the virus, according to government surveys. More women also dropped out of the workforce last month, likely to care for children, after many had returned in the previous two months.
In addition, construction companies and manufacturers, especially automakers, have been left short of parts because of clogged supply chains and have had to slow production for now. Both sectors pulled back on hiring in April. And some businesses say they believe that a $300-a-week jobless benefit, paid for by the federal government, is discouraging some of the unemployed from taking new jobs.
Still, companies have added jobs for four straight months, the Labor Department said Friday, though the government lowered its estimate of job growth for February and March by a combined 78,000. April’s total is far below March’s gain of 770,000.
The resumption of hiring has encouraged some Americans to start looking for jobs, which means they are newly counted as unemployed if they don’t immediately find work. This is what happened in April, when the unemployment rate ticked up from 6% to 6.1%.
Employers are now posting far more jobs than they did before the pandemic, and “help wanted” signs dot many restaurant windows. Other telltale signs of labor shortages have emerged as well: Average hourly pay rose 0.7% in April to $30.17, which the government said suggests that the fast reopening of the economy “may have put upward pressure on wages.” The average workweek also rose, evidence that companies are asking their employees to work more.
“Demand is outpacing supply,” said Daniel Zhao, senior economist at Glassdoor, a job listings website. “That’s something that is occurring across the economy, in semiconductors to lumber, and we’re seeing a similar crunch in the labor market.”
The Associated Press contributed to this report.