Happy Tuesday and welcome to On The Money, your nightly guide to everything affecting your bills, bank account and bottom line. Subscribe here: thehill.com/newsletter-signup.
Today’s Big Deal: How businesses are pushing their employees to get vaccinated by targeting their wallets. We’ll also look at another record-breaking jump in house prices, dwindling Social Security funds, and a surge in stimulus check scams.
But first, here’s a heartwarming story about a successful (and adorable) cat rescue.
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For The Hill, I’m Sylvan Lane. Write me at slane@thehill.com or @SylvanLane.You can reach my colleagues on the Finance team Naomi Jagoda at njagoda@thehill.com or @NJagoda and Aris Folley at afolley@thehill.com or @ArisFolley.
Let’s get to it.
Firms eye financial penalties for unvaccinated workers
Companies are considering more aggressive alternatives to vaccine mandates after Delta Air Lines announced last week that it would implement a $200 monthly surcharge on unvaccinated employees enrolled in the company’s health care plan.
- Delta’s announcement intrigued firms that are eyeing stronger incentives to get employees vaccinated.
- Those companies view the surcharge as a way to boost vaccinations without having to fire workers or take other disciplinary action against those who refuse to get the shot.
But some employers are concerned that hiking health care premiums or imposing other financial penalties could create administrative and regulatory burdens and even prompt anti-vaccine employees to find work elsewhere amid record job openings.
“Lots of employers are very interested in this; none of them have pulled the trigger,” said Judith Wethall, a partner at McDermott Will & Emery who advises corporate clients on health benefits. “It’s being very carefully thought out and vetted.”
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The tradeoff:
- COVID-19 hospitalizations involving unvaccinated patients in June and July cost the U.S. health system $2.3 billion, according to an August analysis by the Kaiser Family Foundation.
- Employers that don’t implement tougher vaccine rules risk endangering their employees, but those that impose stricter rules might lose workers who decide to take advantage of the record 10.1 million job openings in the U.S., according to Labor Department data from the end of June.
“If a company feels that it can prevent the spread within their facility, combine that with a fear of losing labor, that leads to the decision many of them are making,” said Geoff Freeman, president of the Consumer Brands Association, which represents companies like General Mills and Coca-Cola. The Hill’s Karl Evers-Hillstrom walks us through it here.
LEADING THE DAY
Home prices rose 18.6 percent annually in June, a third-straight record high
A closely watched gauge of housing prices rose nearly 20 percent year over year in June, according to data released Tuesday, setting a new record high for the third consecutive month.
- The S&P CoreLogic Case-Shiller U.S. National Home Price Index rose 18.6 percent in the 12 months leading into June, up from 16.8 percent in May and 14.8 percent in April.
- The index rose 2.2 percent month over month since June, 1.8 percent when seasonally adjusted.
What’s going on? Housing prices have skyrocketed for more than a year after the onset of the coronavirus pandemic unleashed intense demand for homes.
- A combination of ultralow interest rates, the widespread adoption of teleworking and virtual education and higher household savings spurred a rally in both sales and prices through much of 2020.
- While sales have fallen off slightly this summer, prices have continued to steam ahead as intense backlogs, supply shortages and the shadow of the lumber price spike offset slightly declining demand.
“The last several months have been extraordinary not only in the level of price gains, but in the consistency of gains across the country,” said Craig J. Lazzara, managing director at S&P, in an analysis.
“We have previously suggested that the strength in the U.S. housing market is being driven in part by reaction to the COVID pandemic, as potential buyers move from urban apartments to suburban homes. June’s data are consistent with this hypothesis,” he added. I’ll explain here.
SOCIAL ANXIETY
Social Security reserves estimated to be depleted earlier than previously expected: The Social Security trust fund for retirement and survivors benefits is estimated to have its reserves depleted in 2033, one year earlier than previously projected, according to the trustees’ report released Tuesday.
- At the time of depletion, income flowing to the trust fund would be enough to pay 76 percent of scheduled benefits, the report said.
- Senior administration officials said on a call with reporters that the earlier projected depletion date was due to the coronavirus-related economic downturn, particularly a near-term decline in revenue.
“The pandemic and its economic impact have had an effect on Social Security’s Trust Funds, and the future course of the pandemic is still uncertain,” Social Security Administration Acting Commissioner Kilolo Kijakazi said in a statement. “Yet, Social Security will continue to play a critical role in the lives of 65 million beneficiaries and 176 million workers and their families during 2021.” Naomi has more here.
CHECK THIS OUT
IRS sees surge in reports of stimulus check scams: The IRS’s criminal investigation division said this week that the agency received a record number of reports about stimulus check scams in June and July.
The IRS’s criminal investigation division said this week that the agency received a record number of reports about stimulus check scams in June and July.
“Even though taxpayers have received multiple rounds of Economic Impact Payments, we saw phishing scams surge this summer,” Jim Lee, chief of the criminal investigation division, said in a news release.
“The number of reported scam attempts reached levels we haven’t seen in more than a decade,” Lee continued. “More than ever, it is important for taxpayers to continue to protect their personal information and not fall victim to these scams.”
How to protect yourself: The IRS said that recent scams include text messages directing people to click on links to provide their information to get stimulus payments, and phishing emails that claim that recipients are eligible for stimulus payments of specific amounts.
The IRS noted that it does not send taxpayers unsolicited emails and text messages, threaten people with jail time or lawsuits or demand payments through gift cards or cryptocurrency.
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If you’ve been scammed: People who receive unsolicited emails that appear to be from the IRS can forward them to phishing@irs.gov. Taxpayers can report instances of theft of their stimulus payments to the Treasury Inspector General for Tax Administration, the IRS said.
Naomi breaks it down here.
Good to Know
The Department of Labor on Tuesday announced the establishment of a new office that will be tasked with helping state agencies modernize and reform the unemployment insurance system.
Here’s what else have our eye on:
- About half of LGBT U.S. renters who are behind on their payments fear eviction in the next two months, according to research released by the University of California-Los Angeles’s Williams Institute.
- Reps. Alexandria Ocasio-CortezAlexandria Ocasio-CortezOn The Money — Companies consider making unvaccinated workers pay Progressive Democratic lawmakers urge Biden to replace Powell as Fed chair Business groups aim to divide Democrats on .5T spending bill MORE (D-N.Y.), Rashida TlaibRashida Harbi TlaibOn The Money — Companies consider making unvaccinated workers pay Progressive Democratic lawmakers urge Biden to replace Powell as Fed chair Progressives dig in for fall fight with centrists MORE (D-Mich.) and Ayanna PressleyAyanna PressleyOn The Money — Companies consider making unvaccinated workers pay Progressive Democratic lawmakers urge Biden to replace Powell as Fed chair Eviction ruling puts new pressure on Congress MORE (D-Mass.) are urging President BidenJoe BidenTapper presses top Biden aide on Afghanistan: ‘How are you going to get those Americans out?’ Overnight Defense & National Security: War ends, but finger pointing continues On The Money — Companies consider making unvaccinated workers pay MORE to replace Federal Reserve Chair Jerome Powell as his term’s end date nears.
- Senate Budget Committee Chairman Bernie SandersBernie SandersOn The Money — Companies consider making unvaccinated workers pay ‘Not this time’: Sanders blasts lobbyists plans targeting Democrats’ spending bill Feehery: Seizing the radical middle MORE (I-Vt.) took aim at business lobbyists targeting a $3.5-trillion spending package being drafted by Democrats that would raise taxes on the wealthy to help cover costs for funding boosts in areas related to climate change, education and other party-backed priorities.
That’s it for today. Thanks for reading and check out The Hill’s Finance page for the latest news and coverage. We’ll see you tomorrow.
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