Thursday 28 May 2020

U.S. On The Edge Of A ‘Severe Renter Crisis’ After Millions Of Job Losses

A Columbia Law School professor is warning that the United States is on the verge of a flood of renter evictions after about two months of mandatory government shutdowns that have cost millions of people their incomes.
Columbia Law School associate professor and housing expert Emily Benfer says emergency protections put in place to protect renters from eviction during the pandemic are about to lapse in about half of the United States. Although Congress has substantially boosted unemployment benefits during the pandemic, roughly a quarter of Americans are struggling to make rent and mortgage payments.
“I think we will enter into a severe renter crisis and very quickly,” Benfer told The New York Times. “We will have an avalanche of evictions across the country.”
Just over 25% of Americans report that they have either missed their last rent or mortgage payment or have little to no confidence that they can pay their next one, according to a weekly tracking survey from the Census Bureau.
The Labor Department reported last week that jobless claims since mid-March have hit over 36 million as the U.S. economy continues to tumble because of the virus and mandated government shutdowns. The Census Bureau’s survey also shows that a third of Americans are showing signs of clinical depression or anxiety.
Congress approved an additional $600 a week in unemployment benefits in March to aid people suffering job losses and being placed on furlough amid widespread government shutdowns. Earlier this month, a group of economists at the University of Chicago estimated that the increase in unemployment benefits has caused two-thirds of Americans who have lost paychecks during the pandemic to make more than if they were still working.
Shutdowns led to an unprecedented wave of unemployment claims that overran state labor departments and unemployment reporting centers. An untold number of Americans fell through the cracks early in the process as their applications were lost or because they were never able to connect with a processer in the first place. Clogged phone lines and crashed unemployment systems created days and weeks of confusion.
Congress also approved a one-time payment of $1,200 for almost all Americans. Those checks are taking weeks to hit the bank accounts of most Americans, however.
Many businesses have remained shuttered for about two months now, and business owners who are unable to bring in revenue are running out of resources needed to reopen their businesses once lockdown orders are lifted. Economists predict that a wave of small business closures, as much as 40% of small businesses in the United States, will hit over the next six months.
With each business closure, the time it will take for the United States to recover from the current economic crisis grows longer. Fewer jobs will be available for Americans coming out of lockdown, and competition for the jobs that are left will be stiff.

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