US poverty rises as aid winds down.

Poverty rates in the US are rising, as government aid winds down despite ongoing economic distress caused by the pandemic.

Nearly 8 million Americans - many of them children and minorities - have fallen into poverty since May, university researchers have said.

Last week, nearly 900,000 people filed new claims for jobless benefits - the highest number since August.

Analysts have called for aid to prevent the economic recovery from stalling.

But politicians in Washington have been at odds over a deal for months, with talks in recent weeks overshadowed by the upcoming presidential election and disputes over the Supreme Court.

"The sobering reality is that it appears further help may not be coming from elected officials in Washington," said Mark Hamrick, senior economic analyst at

This spring, as the pandemic cast more than 20 million Americans out of work, the US government approved more than $3tn (£2.3tn) in relief money.

The aid included cheques of up to $1,200 for most individuals and money to temporarily boost unemployment benefits by an extra $600 per week.

The massive spending wave initially blunted the economic upheaval caused by the virus, prompting poverty rates to decline.

But those figures began to tick up again this summer, as the one-time financial boost from the cheques wore off and the expansion to unemployment benefits expired at the end of July.

A separate analysis by researchers at the University of Chicago and Notre Dame estimated the poverty rate at 10.1% in September, up from the 11% seen in February and 9.3% in May.

The increase is in line with rising poverty rates around the world due to the pandemic. The World Bank this month warned that extreme poverty was set to rise for the first time in more than two decades.

Labor Department report showed an unexpected 53,000 increase in unemployment filings from the week before, sending new claims to a two-month high.

More than 25 million people continued to collect some form of unemployment payment as of 26 September, the Labor Department said.

Wells Fargo economist Sarah House said the report showed "the risk of the labour market's recovery going into reverse".

Democrats in May approved more than $3tn in additional spending, but Republicans in the Senate have balked at the sums and White House efforts to broker a compromise have so far failed.

On Thursday, Mr Trump said he was willing to agree to more spending, but Treasury Secretary Steven Mnuchin, who has been leading negotiations on behalf of the president, said a deal would be difficult before the November presidential election.

Mitch McConnell, who leads Republicans in the Senate, said Congress would approve more aid, if not before the election then after. But he warned that his members continue to favour more limited, targeted relief.

Source: BBC