Will there be another stimulus check? It’s looking less likely.
For many Americans, it’s been months since the most recent round of stimulus checks hit their bank accounts, though the IRS has, over the past number of weeks, been working diligently to send out catch-up payments to those who didn’t receive a stimulus, or a full stimulus, earlier on in the year. Of course, the big question on a lot of people’s minds is none other than will there be a fourth stimulus round? But when we look at the greater economic picture, it’s easy to see why the answer may be a resounding “no.”
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The unemployment situation keeps improving
Over the past few months, the number of new weekly jobless claims coming in has been substantially lower than the numbers we saw earlier on in the year, when the $1.9 trillion American Rescue Plan was signed into law. This past week, in fact, weekly jobless claims totaled just 360,000, and while that may read like a large number, it actually represents a pandemic-era low.
Meanwhile, the total number of Americans who are receiving jobless benefits fell to a little more than 14 million. Again, that sounds like a lot of people (and it is a lot of people). But to put it in context, it’s less than half of the total number of people who were receiving unemployment benefits a year ago. And with jobless numbers declining, it’s becoming harder to justify another stimulus round.
Consumer demand is high
Inflation recently reached a 13-year high, and while the fact that everyday purchases like groceries and gas are costing more may be hurting a lot of people individually, it’s actually a sign that consumer demand is increasing. That, in turn, signifies that the economy itself is stronger.
A big reason things are costing more these days is that the demand for them exceeds the supply available. As the economy improves, consumers are buying more groceries, filling up their cars more frequently, traveling more, and purchasing more cars and electronics. There’s a limited supply to go around in all of these categories, and so they’re all costing more. But that signifies that the economy is doing better than it was months ago, when consumers were spending less and demand was lower across the board. And if the economy is healthy, it’s difficult to make the case for another stimulus payment.
Should Americans write off a fourth stimulus check?
It’s too soon to say definitively that a fourth stimulus check isn’t going to happen. But is it likely to happen? At this point, no.
That said, this week, the IRS began sending out payments to families who qualify for the newly expanded Child Tax Credit. Those payments are worth up to $300 per child and will be issued in monthly installments between July and December (with a follow-up lump sum to be issued in 2022). Clearly, not everyone will be eligible for these payments, but for those longing for a fourth stimulus check, they’re certainly not a bad consolation prize.