One thing government is not choking is people’s desire to work.
Republicans have told us that handing out $600 coronavirus relief checks on top of regular unemployment benefits will encourage Americans not to seek work. As usual, research shows Republicans are wrong:
…a new report by Yale economists found no evidence that these “enhanced jobless benefits” reduced employment.
…Using data on hundreds of thousands of hourly workers across the U.S. and Canada, primarily in lower income brackets, researchers concluded that the expanded benefits did not increase layoffs at the outset of the pandemic or discourage workers from returning to their jobs over time.
“As many states struggle with surges in Covid-19 cases as they move to reopen, there are still good reasons to not incentivize everyone to return to work and to continue to support displaced workers regardless of the labor market effects of such social insurance. However, we find no evidence to support concerns about adverse aggregate labor supply effects of expanded UI generosity in the context of the current pandemic,” the study said [Anagha Srikanth, “There Is No Evidence That Unemployment Benefits in the CARES Act Reduced Employment: Study,” The Hill, 2020.08.06].
See that word “Study” in The Hill‘s headline? That’s not a noun; that’s an imperative verb, as in a command, as in, “Hey, Republicans: study!”
You want to get people back to work? Develop a vaccine for coronavirus and distribute it equitably to every worker and family in the country. Until that happens, keep supporting Americans through this epic market failure.
Quote “primarily in lower income brackets, researchers concluded that the expanded benefits did not increase layoffs at the outset of the pandemic or discourage workers from returning to their jobs over time.”
I will say in a MN business, what I have noticed is that finding New Hires, vs people returning from lay offs, appears to be more difficult. From what I am witnessing, I feel the $600 weekly benefit makes staying at home–especially during the summer, a bit more attractive.
We pay well, have decent benefits, and still struggle to find enough people to fill our slots. We’ll see what the end of summer brings …
If people are staying home because they make more getting $600 from the government then that’s telling me that companies should pay workers more.
Plus everybody getting the extra money knows that it’s going to end-either now or in the very near future. So if they’re recalled to their old job or they find another job they’ll take it or they might not find one later.
What it did for me was being more selective for what job I could find. Anybody isn’t going to work for minimum wage when they can wait and find a good job. I’m making less now than I was when I was unemployment with the extra $600. But I felt it was something I wanted to do and it might not be available later.
This unemployment check was specifically for people who lost their job through no fault of their own. They had a job and were working by their own choice long enough to get unemployment and were unemployed during a time when there was the highest unemployment in my history. So when the republicans say it encourages laziness as Cory points out in his research they were wrong. Most people would rather work and this time it was only for them. Republicans simply did not think on this one.
Good on you, Mr. Owen!
That cushion gave Owen the chance to find a job that best utilizes his skills. That’s an optimal market outcome. Rushing super-qualified people into crap jobs just because they can’t afford groceries this week wastes human resources, leaves the skilled worker stuck in a lower-skill, lower-income job that will reduce that person’s spending and economic activity, and blocks a lower-skilled person from getting into the labor force and contributing to the best of her abilities. Unemployment insurance is thus an investment in optimal use of labor.
The CARES Act pumped an extra $187 million into unemployed South Dakotans’ pockets to tide them through the first part of this coronavirus recession. The state paid out another $70 million in regular UI.
With unemployment still at 7.2% in South Dakota, national unemployment at 10.2%, and the total economy down 12.9 million jobs from pre-pandemic, we need that support to keep coming to help the unemployed feed their kids and search out their next best employment.
Pulling that $600 a week (and failing to negotiate a replacement plan before that plan expired) means millions of Americans may miss rent and get evicted. Evictions don’t help the economy.
This Yale study shows that offering this vital support does not disincentivize work. Yet Republicans are still sandbagging a deal on extending coronavirus aid by insisting that we counterproductively cut the UI additional benefit to $400 a week:
Extend the UI benefits, help people in need now, and give the economy time to recover.
$600 Coronavirus Jobless Benefit Doesn’t Discourage Work, but bein g dead on drumpf’s ever expanding body count would.
United States
Coronavirus Cases:
5,053,285
Deaths:
163,203
Count is higher than Grudzilla on weed.
better deal here than south Dakota pays.We came to die not to buy should be the states motto.
right now I’d wager in a minute that 95% of this $600/week is being injected INTO the economic
$$ bloodstream further activating the economy. I think this does our economy better than the GOP insisting on bloating a military/industrial $$ stream that only pads the pockets and overseas bank accounts of the tycoons of the military/industrial largesse. When Joe Sixpack has an extra dollar he will usually spend it, right? The GOP has to have a boogeyman under the bed to blame, always.
If you want to know what is undermining work, it’s the Republicans and their capitulation to the virus.
Ariel, may I ask a few follow-up questions for context? What industry business are you hiring in? What is the typical wage you are hiring for? Is this full-time employment? What benefits come with that wage?
Apparently millions in forgivable loans does not provide a disincentive for the top 1% to work, either.
10+% unemployment, millions ladled to the top 1%, the senate argues about $600 and takes Friday & the weekend off.
Vote. The. Bums. Out.
Ariel, maybe people are less willing to work because they are more concerned about becoming ill due to job conditions, vs. the $600.
I can tell you, as a PhD in Organizational Psychology, and someone who has designed and implemented performance incentive systems for some major companies, all sorts of research has found that money is one of the least effective motivating factors there are for the vast majority of people.
On the other hand, management simply expressing a direct personal interest in someone’s job conditions is one of the most effective motivating actions an employer can take. That is why the idea of “managing by walking around” is so effective.
Of course none of the folks who are getting unemployment or the extra $600.00 a week are spending that money. They are hoarding it or something nefarious according to republican logic,
The overextended American citizen’s situation has come home to roost. They worked in a gig economy at 3 jobs so they had the purchase power to buy into what was marketed to them and now that economy is gone and it ain’t coming back, maybe forever, but at least until there is a vaccine.
In the meantime, without the $600.00, who will not be paid for those marketed products that the American worker bought? Clearly, there is not enough money, even with the $600.00 to now buy food for millions of us. Are we prepared for even more millions of hungry homeless people on the streets? How many more hogs will we steam to death or chickens that we smother to keep from going to market so there can be a market crooked as it is?
Hi O,
Of course I make a comment and then can’t spend any time on my computer. :) This is full time work, in food manufacturing (not slaughter) Our starting wage is $14.00 for line workers. We do have barriers, masks, and have very low incidence of COVID. Thankfully, everyone has recovered. We have had bonuses each month during COVID, nice annual bonuses, Christmas bonuses and very good insurance and benefits. Overtime is available but not usually mandatory. It is generally comfortable working conditions, although we do have some freezer work. We have float pool positions with flexible schedules for those who want to work less structured. They can work as much or as little as they want.We had part time slots as well and room for advancement.
Richard, your point is a good one, but I have been surprised how quickly the place jumped in to do the best thing as soon as possible. We are still family owned and they have been here…distancing of course, to deliver masks they had made and to check morale. I have been here 18 years and was very surprised at how hard it has become to get good people to apply. Our unemployment WAS around 4% in the county, which was really low