WASHINGTON, Oct. 7 (Xinhua) -- U.S. Federal Reserve officials expressed concern about the expiration of the enhanced unemployment insurance benefits, noting that additional fiscal relief would help sustain the recovery, according to the minutes of the Fed's latest policy meeting released Wednesday.
Federal Open Market Committee (FOMC) participants observed that labor market conditions continued to improve in recent months, but the labor market was still "a long way from being fully recovered," said the minutes of the Fed meeting held on Sept. 15-16.
Roughly 22 million people were laid off in March and April amid COVID-19 shutdowns, pushing up the unemployment rate to double digits. Latest data from the U.S. Labor Department showed that payrolls are more than 10 million below pre-pandemic levels.
"Some participants noted that the majority of gains in employment so far reflected workers on temporary layoffs returning to work," the Fed minutes said.
"These participants judged it as less likely for future job gains to continue at their recent pace, because a greater share of the remaining layoffs might become permanent," it continued.
The Fed minutes noted that most participants expressed concern about the expiration of the enhanced unemployment insurance benefits from the CARES Act, or the Coronavirus Aid, Relief, and Economic Security Act, approved by Congress in late March.
The extra 600-dollar per week federal unemployment benefits expired at the end of July. Two months later, Congress and the White House remain deadlocked on the next round of coronavirus relief.
"Participants viewed fiscal support from the CARES Act as having been very important in bolstering the financial situations of millions of families, and a number of participants judged that the absence of further fiscal support would exacerbate economic hardships in minority and lower-income communities," the Fed minutes said.
"Indeed, many participants noted that their economic outlook assumed additional fiscal support and that if future fiscal support was significantly smaller or arrived significantly later than they expected, the pace of the recovery could be slower than anticipated," the minutes said.
The minutes also noted FOMC participants continued to see the uncertainty surrounding the economic outlook as "very elevated," with the path of the economy highly dependent on the course of the virus; on how individuals, businesses, and public officials responded to it; and on the effectiveness of public health measures to address it.
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