Welcome to the month of July in this crazy 2020 year. Today is minimum wage increase day. I think we’ve mentioned enough, but the wage floor increased to $10 today and will increase again on January 1, 2021 to $11 an hour. Also, a reminder that the gas tax goes up seven tenths of one cent. Not nearly as much as last years’ 38 cents. Check out today’s update below.
PPP Goodbye … Not So Fast
Yesterday we talked about the potential of an extended PPP fund with the remaining balance. After our update was sent, in somewhat of a surprise, the Senate cleared legislation to extend the deadline for businesses to apply for coronavirus aid under the Paycheck Protection Program. Under the bill passed by the Senate by unanimous consent, the deadline for applying for PPP loans would be extended until Aug. 8.
Continuation of Unemployment Insurance Bonus
Senate Democrats introduced legislation named the American Workforce Rescue Act to extend the additional unemployment benefits amid the coronavirus pandemic. The proposal would extend the $600 increase in weekly unemployment insurance (UI) benefits past July 31 until a time when a state’s three-month average total unemployment rate falls below 11%. The federal benefit would drop from $600 a week by $100 for every percentage point decrease in the state’s unemployment rate, until that rate falls below 6%. For example, people who are out of work in a state with an unemployment rate between 10 and 11% would receive a weekly federal benefit enhancement of $500 under the proposal, and people in a state with an unemployment rate of between 9 and 10% would receive $400 a week.
Senate Republicans however, are rallying around a plan to instead provide a $450-a-week bonus to people who leave the unemployment rolls and return to work, but Democrats say that won’t help people who can’t return to their old jobs or find new ones. Federal Reserve officials predicted last month that the national unemployment rate would remain above 9% through the end of 2020.
The Senate Democratic plan would also extend the Pandemic Emergency Unemployment Compensation program until March 27 and remain available until a state’s unemployment rate falls below 5.5%.
The pandemic unemployment compensation program provides up to 13 weeks of additional benefits to people who have exhausted their state and federal unemployment benefits.
If a state’s unemployment rate is above 8.5%, people without work in those states are eligible for up to 52 weeks of the pandemic emergency unemployment compensation.
IDOL Alerts Local Officials on Hiring for Public Works Projects
Due to the high unemployment rate caused by the ongoing COVID-19 pandemic, the Employment of Illinois Workers on Public Works Act takes effect beginning July 1st. The state law requires the workforce on all public works projects to be comprised of a minimum of 90% Illinois residents.
The Illinois Department of Labor (IDOL) administers the Employment of Illinois Workers on Public Works Act, which was enacted to alleviate unemployment in Illinois by ensuring that most workers on public works projects live in the state. The requirement to employ 90% Illinois workers applies to all labor on public works projects or improvements, including projects involving the clean-up and on-site disposal of hazardous waste.
The law comes into effect following two consecutive months of a state unemployment rate above 5%. According to the U.S. Bureau of Labor Statistics, Illinois’ unemployment rate during the COVID-19 pandemic increased from 4.2% in March, to 17.2% in April, and 15.2% in May.
Stock Market – Believe It or Not
The second quarter of April through June saw the best recorded gains since 1998 on the S&P 500. This obviously has been unprecedented times, but the swing from the beginning of the year until now tremendous. The S&P finished the quarter up nearly 20% after declining an identical 20% drop in the first quarter of 2020. This first quarter drop was the worst since 2008. A positive outlook amid progression with retail numbers and jobs returning certainly fueled the rebound. It will be interesting to see what the next three months bring as recent spikes in cases could potentially dampen the economies of the areas reinstituting their restrictions.
Coronavirus Testing in Schools
The CDC released some new recommendations based on COVID-19 testing in schools. The new information says that schools should not conduct universal coronavirus testing for students and staff when reopening this fall and school staff should not be expected to directly administer tests.
2.4 Million Jobs Added in the Month of June
U.S. private-sector businesses added nearly 2.4 million workers in June, according to the monthly employment report from the ADP Research Institute and Moody’s Analytics that were released today. Almost 1.9 million were at service-sector businesses shuttered by the pandemic throughout the past three months. The leisure and hospitality industry led all other sectors with a gain of 961,000 jobs, followed by construction (394,000), trade and utilities (288,000) and education and health (283,000).
Finally, for those wondering, today marks the official beginning of the U.S. – Mexico – Canada Agreement or otherwise known as USMCA. The USMCA replaces the North America Free Trade Agreement (NAFTA). This new agreement was long debated and is very promising for small businesses especially. We’ll be sure to advance more information as the agreement gets going.
Joliet Region Chamber of Commerce & Industry Staff and Board of Directors
Vice President – Government Affairs
Joliet Region Chamber of Commerce & Industry
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