The American Rescue Plan was signed into law in March 2021, and within weeks of its passage, stimulus checks began arriving in recipients’ bank accounts. It has been more than a year since Americans became eligible for that level of widespread assistance. However, it has been challenging to make the case for a follow-up check.
The US economy has improved significantly over the last year. The national unemployment rate has decreased significantly, and the labour market is so strong that job seekers now have more leverage to demand higher wages.
Despite this, many Americans are concerned about the economy’s direction. According to a recent CNBC + Acorns Invest in You survey, 81% of respondents believe the United States will experience recession at some point in 2022.
While those concerns are understandable, the reality is that our economy is not on the verge of collapse. As a result, a fourth stimulus check is unlikely to materialise anytime soon.
The situation is not as dire as it appears.
It’s understandable why some people are concerned about the economy taking a severe downturn. Inflation has been soaring, to the point where many people’s living costs are unsustainable. And many believe that the Ukraine conflict will have a detrimental effect on the US economy.
Despite these legitimate concerns, many economic experts maintain that a recession is unlikely to occur anytime soon. If anything, the economy is in a very strong position, at least in terms of unemployment.
The number of new jobless claims filed during the week ended April 2 was 166,000. This is the lowest weekly claim total since late 1968.
In total, 1.72 million Americans received unemployment benefits last week. At first glance, that may appear to be a large number of people. However, to put that figure into context, it was 18.4 million a year ago, indicating that we’ve come a long way on the jobless front.
Make no assumptions about obtaining assistance.
Legislators are aware that many Americans are struggling to keep up with rising living costs. Some have even proposed allocating stimulus funds to offset the increase in gasoline prices. A gas-related stimulus, on the other hand, is somewhat improbable, especially given the Biden administration’s intention to tap into its oil reserves in order to help Americans pay less at the pump.
However, should the public anticipate a widespread round of stimulus checks akin to those issued under the American Rescue Plan? No. The economic situation is vastly different today than it was then, and while inflation is a burden, it is nothing compared to having millions of Americans out of work with no prospects for employment or vaccine protection.
Of course, we can and should all hope for a gradual decline in inflation. However, inflation alone will not justify a fourth stimulus check, nor will recession-related concerns – particularly those that economists are hesitant to voice.