An estimated 1.3 million Americans will lose their unemployment benefits after an emergency federal program expired on Saturday.
Lawmakers failed to agree on an extension of the scheme before the Congress began its winter recess.
Former President George W. Bush introduced the assistance plan in 2008 at the start of the recession.
Under the program, jobless people received an average monthly stipend of $1,166 for up to 73 weeks.
The White House says the benefits have kept millions of families out of poverty, but many Republicans argue that the scheme’s annual $25 billion price tag is too expensive.
The stalemate comes two months after a budget fight in the US Congress led to the partial shutdown of the government.
President Barack Obama has vowed to push for the renewal of the expired program when Congress reconvenes in early January.
An estimated 1.3 million Americans will lose their unemployment benefits after an emergency federal program expired
“The president said his administration would, as it has for several weeks now, push Congress to act promptly and in bipartisan fashion to address this urgent economic priority,” White House spokesman Josh Earnest said.
An estimated 1.3 million people will initially be cut off with the end of the “emergency unemployment compensation”, US officials say.
Millions more could be affected next year after they lose state benefits, which in many states expires after six months.
The financial aid was designed to help US citizens who lost their jobs during the recession and were unable to find new work while receiving the state benefits.
The US unemployment rate fell to a five-year low of 7% in November, according to the US Labor Department.
But the long-term jobless rate remains a problem for the economy, with some 4.1 million Americans currently out of work for six months or longer.
There has been repeated political wrangling between the Republicans, who control the lower house – the House of Representatives – and the Democrats, who have a majority in the upper house, the Senate.
Because of disagreements between the two houses over federal government spending, the Congress failed to pass a budget before the fiscal year ended on September 30.
Both sides eventually struck a last-gasp deal in October to end the federal shutdown and raise the federal debt limit.
The US Labor Department has announced the unemployment rate fell to a five-year low of 7% in November.
Payroll figures also showed that 203,000 jobs were created last month, more than predicted, as the US economy displayed more signs of strength.
The monthly non-farm payroll figure is watched closely by economists.
Analysts say these indications of strong growth could mean that the Federal Reserve will start to unwind its massive stimulus programme soon.
However, the November figure might have been distorted. Some federal workers who were counted as jobless in the October – because of the 16-day partial government shutdown – returned to their jobs last month.
The latest data also showed that the October and September non-farm payroll figures, which had also been strong, were even better than their first estimates.
The US unemployment rate fell to a five-year low in November
Job gains for those two months were revised upwards by 8,000.
Chris Williamson, chief economist at research firm Markit, said the data indicated the US labor market was “buoyant”.
“The decline pushes the jobless rate down to its lowest since November 2008 and closer towards the Fed’s threshold of 6.5%, which it wants to see breached before it considers tightening policy via higher interest rates,” he said.
But he added that a decision on when the Fed might start to taper its stimulus programme was still not clear cut.
The labor market figures follow news earlier this week that economic growth, as measured by GDP, in the third quarter of the year was revised up to an annual pace of 3.6% from a previous estimate of 2.8%.
Also on Friday, the US Commerce Department said that consumer spending increased in October, though wages and salaries were barely changed.