Federal Reserve Study: Ending pandemic assistance ‘associated with substantial rise’ in employment

A new study released this week by the Federal Reserve Bank of St. Louis showed that ending federal pandemic assistance to US residents may have contributed to an increase in employment numbers.

The emergency unemployment benefits (UAB) offered by the federal government and distributed by state governments during the height of the COVID-19 pandemic were intended to provide financial assistance to those who could not work due to the virus, and those who lost their jobs.

Federal Reserve Bank of St. Louis, one of the twelve regional banks that make up the Federal Reserve, assessed data from 46 states and the District of Columbia and found a strong correlation between the end of the COVID-era relief payments and a bump in employment numbers.

“The act of halting by a state was – on average – associated with a substantial rise in employment and a substantial decline in the number of unemployment insurance recipients relative to the other months,” the study reads. “Terminating EUB had a statistically significant and quantitatively large positive impact on employment.” 

Examining each state separately, the study found that directly following each state’s halting of the EUB program, the state experienced an employment boom. “In the three months following a state’s EUB termination, employment increased by about 37 people for every 100-person reduction in EUB recipients,” write the study’s authors. 

The trend shows no signs of slowing, with July’s job numbers coming in much higher than expected and adding 528,000 jobs to the economy, and the unemployment rate hitting a 50-year low at 3.5 percent. 




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Laura is a freelance writer out of Maryland and a mom of three. Her background is in political science and international relations, and she has been doing political writing and editing for 17 years. Laura has also written parenting pieces for the Today Show and is currently working on writing a collection of remarkable true stories about normal people. She writes for FBA because unbiased news is vital to unity, and readers deserve the facts free of opinion.

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