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Illustration: Aïda Amer/Axios

New data on Americans' finances suggests the extension of enhanced unemployment benefits and direct payment checks would provide a significant boost to the economy.

Driving the news: A new report from the JPMorgan Chase & Co. Institute finds that the increased payments for unemployment "played an important role in maintaining household spending and wider macroeconomic stability."

What they're saying: "With a March 15, 2021 deadline on supplemental and extended jobless benefits approaching, policymakers should consider the important role these benefits play in supporting the spending and saving of jobless workers, given the limited impact they appear to have had on job search."

How it works: The report analyzed the impact of supplemental unemployment benefits on job finding, spending, and saving of jobless workers between April and July 2020.

  • It found that the $600 supplement "likely played little role in discouraging people from finding work."
  • "Rather, expanded UI boosted the spending and saving among jobless workers, many of whom are facing extended or repeated unemployment spells."

Where it stands: Using the bank's data, the JPMorgan Chase Institute found a strong correlation between the spending and saving of jobless workers and the availability of supplemental unemployment insurance benefits during the pandemic.

  • "We estimate that for every dollar of supplemental unemployment insurance, the median unemployed family has spent between 29 and 43 cents more than they otherwise would have."

There's more: A new report from data firm Morning Consult argues that sending $1,400 stimulus checks targeted to low-income adults and parents combined with enhancements to the unemployment benefit system "would prevent unnecessary financial hardship and mitigate future economic risks."

By the numbers: Morning Consult's data show that in January, 16% of U.S. adults said their expenses exceeded their incomes for the month, largely concentrated among low-income households. 

  • Americans with annual household incomes under $50,000 already spent roughly 67% of the money they received in the second stimulus. 
  • Among the 30.2 million adults who couldn't pay their bills, 75% fell short by less than $300, "an improvement from December that shows stimulus checks are bringing people closer to covering their expenses."

Yes, but: Both studies suggest that targeted benefits would be most effective, but neither directly states who should or should not receive benefits, a prime subject of debate given that some Americans who previously made high salaries remain unemployed because of the pandemic.

  • Other workers remain employed but have seen reduced wages and/or hours.

What's next: If $1,400 stimulus checks are sent on March 1, Morning Consult's data show the payments would allow 22.6 million Americans to pay their bills in full through the middle of July.

Go deeper: Unpacking the debate over whether too much stimulus can overheat the economy

Go deeper

Felix Salmon, author of Capital
Feb 11, 2021 - Economy & Business

The stimulus debate: Is it too big?

Illustration: Annelise Capossela/Axios

Can too much federal spending cause the economy to overheat? And is that a real risk of the Biden administration's $1.9 trillion economic rescue plan? The consensus answers to those questions are yes and no, respectively.

Why it matters: Fear of inflation has emerged as the single biggest reason for Democrats and Republicans to oppose the latest round of stimulus. For the time being, however, most economists expect that inflation will remain subdued, even if the full package is enacted.

2 hours ago - Health

Biden says it's "not the time to relax" after touring vaccination site

President Biden speaking after visiting a FEMA Covid-19 vaccination facility in Houston on Feb. 26. Photo: Mandel Ngan/AFP via Getty Images

President Biden said Friday that "it's not the time to relax" coronavirus mitigation efforts and warned that the number of cases and hospitalizations could rise again as new variants of the virus emerge.

Why it matters: Biden, who made the remarks after touring a vaccination site in Houston, echoed CDC director Rochelle Walensky, who said earlier on Friday that while the U.S. has seen a recent drop in cases and hospitalizations, "these declines follow the highest peak we have experienced in the pandemic."

Updated 2 hours ago - Politics & Policy

Coronavirus dashboard

Illustration: Annelise Capossela/Axios

  1. Health: Most COVID-19 survivors can weather risk of reinfection, study says — "Twindemic" averted as flu reports plummet amid coronavirus crisis
  2. Vaccine: FDA advisory panel endorses J&J COVID vaccine for emergency use — About 20% of U.S. adults have received first vaccine dose, White House says — New data reignites the debate over coronavirus vaccine strategy.
  3. Economy: What's really going on with the labor market.
  4. Local: All adult Minnesotans will likely be eligible for COVID-19 vaccine by summer — Another wealthy Florida community receives special access to COVID-19 vaccine.
  5. Sports: Poll weighs impact of athlete vaccination.