We normally expect unemployment benefits to run out after six months, but because of several extensions by Congress, payments can be collected for as long as 99 weeks, or nearly two years. That brings the monthly bill up to $10 billion, a painful-but-necessary expense in a national emergency. But for how long? Given the limited number of jobs out there, it could be longer than any other economic downturn (unemployment benefits were created as part of the Social Security Act of 1935). From the Washington Post:
Unemployment compensation is funded largely through employer taxes (a few states require worker contributions). They have been extended in previous periods of unusually high unemployment, then rolled back when the rate declined. Although the availability of long-term unemployment benefits "could dampen people's efforts to look for work," the Congressional Budget Office said in a February report, that concern "is less of a factor when employment opportunities are expected to be limited for some time."
Some Republicans are grousing that these benefits have become another form of welfare. However, the CBO report finds that they can actually help the economy because people are able to pay for housing, food and other essentials. Eventually, these benefits will have to be pared back, but only when the jobs picture improves and there's no telling when that might happen.