As federal lawmakers debate another relief package for the coronavirus pandemic that’s put approximately 35 million out of work, a new study shows how generous (or not) the added unemployment benefits were in the initial stimulus bill addressing the crisis.
Two-thirds (68%) of jobless workers would bring home more money from their state unemployment insurance and $600 weekly supplement from the feds than they would on the job, according to University of Chicago researchers.
In fact, one in every five eligible workers would receive benefits that were at least double their lost earnings, added the researchers, who emphasized that they weren’t taking a position on whether the benefits were too much or too little.
The median earnings replacement rate was 134% of lost wages, they estimated. In every state, the median earnings replacement rate exceeded lost wages, ranging from 129% in Maryland to 177% in New Mexico.
The supplemental $600 weekly benefits were one part of the $2.2 trillion CARES Act that also included direct $1,200 checks, and potentially forgivable business loans. The additional jobless benefits expire at the end of July.
The study, distributed by the National Bureau of Economic Research this week, said the benefit was a “substantial income expansion” for lower income workers, but pointed out that many workers might have also lost health insurance when they lost their wages.
Lawmakers passed the Coronavirus Aid, Relief, and Economic Security (CARES) Act in late March to quickly inject cash into the country as it reeled from the outbreak and its fast-moving economic consequences.
Approximately 40% of all jobs making less than $40,000 per year in February were gone in March, according to Federal Reserve Chairman Jerome Powell. The country’s unemployment rate hit 14.7% in April and 20.5 million jobs vanished in that month alone, according to the Bureau of Labor Statistics.
The flat rate, however, could have uneven effects because the system “essentially pays bonuses to some workers who are laid off (which might lead to advantageous increases in social distancing) but provides no additional pay for otherwise similar frontline workers.”
For example, a janitor at a still-open business might not get hazard pay, but an unemployed janitor could get 158% of their prior wage, the study said. (Researchers looked at U.S. Census data on job salaries.) In 2018, median household income was $63,179, according to census numbers.
The researchers emphasized they weren’t taking a position on how much the added unemployment benefits should offer. There are arguments for both sides, they said. On the one hand, the money provides much needed liquidity but, on the other hand, high payout rates could discourage people from getting back in the workforce.
Plenty of other people have opinions about the added unemployment benefits.
Several Republicans pointed out many workers could make more money through unemployment during the Senate debate on the CARES Act. They proposed an amendment that would pay workers their lost earnings, nothing more.
“Let’s give them that helping hand and not apologize about it for a minute,” Sen. Dick Durbin, a Democrat from Illinois, responded.
The amendment failed and senators unanimously approved the bill.
Since then, the Democratic-majority House of Representatives passed the HEROES Act, which would, among other things, extend the same $600 supplemental unemployment benefit to January 2021. Sen. Mitch McConnell, the Republican majority leader, brushed off the bill as a Democrats’ wish list.
Treasury Secretary Steven Mnuchin said Congress will likely need to pass another relief bill but said unemployment benefit rates needed to be addressed. “We do need to fix the quirk that in certain cases, we’re actually paying people more than they made,” he said.
Other studies suggests millions of people are struggling to make ends meet, and are using the government money for necessities. Nearly one-third of stimulus check recipients (30%) say they are using the money to pay bills, according to a recent report by YouGov.
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It’s not hard to see how this could easily transition to a full-on socialist style basic-income program since many of those jobs will be lost forever. Even if you could go back to work, why would you want to if the checks keep coming?
Yeah, looks like socialism is winning, getting paid more to not work then you will get paid to work… capitalism is dead. The reasons are myriad, but you cant’t escape that conclusion concerning the present state of affairs.
Blah Blah Blah : average working Americans have been left behind and their wages have spiraled downward as the unchecked illegal cheap labor infests every job site in America . Add to this our nations industrial jobs have been sent to cheap labor markets where a girl in a Chinese orphanage at the ripe old age of 14 is trained on a sewing machine and sent to a clothing factory since she was not adopted . If you call that successful investing as an American than please fuck your self to death you piece of shit ! Union garment workers are in that unemployment and welfare line but they were in the tax paying home owners line before the greatest transfer of wealth in world history took place from middle America to the filthy rich 1% and the political pieces of shit they own !
Since the Welfare gamers live as if they earn $60 grand a year with health care , food and housing assistance what idiot would waste their lives making someone else wealthy while you barely make it to work on public transportation .
Don’t blame working people for economic conditions in America when it has been the 1% investor class and the Washington DC pigs at the trough that have totally fucked everything up for the majority of working Americans !
G.R.E.E.D is more damaging than E.N.V.Y.
This again?
From Merriam-Webster:
greed: a selfish and excessive desire for more of something (such as money) than is needed
envy: painful or resentful awareness of an advantage enjoyed by another joined with a desire to possess the same advantage
In greed I see NO inherent victim. Envy cannot exist without a target (potential victim).
Jamie Dimon gets a Guaranteed Minimum Income in the billions, as do all the other high ranking banksters and pirates of Wall Street. And every time they crash the economy their incomes go up. But for some reason it’s only considered a problem when the peasants get an extra $600.
The wealthy shits aside (who likely would not be wealthy if NOT for the actions of government), it is a problem if you breed dependency on the government theft mechanism that punishes all who work for the benefit of those who don’t.
Cog dis
To the government, it is one size fits all. Unemployed workers in flyover country are making more that they did while working and those in high cost coastal states are having a hard time making ends meet. Almost everyone who paid taxes last year got a stimuless check, even those who are still working and doing OK.
“Doing ok” is a vague conclusion.
I had 3 jobs, lost one of those. About a 40% reduction in my income. But, because I have other jobs I get no UE and don’t even count among job losses. So, I’m a “success” by their measure w 40% income reduction. Yes, I got the $1200 payment … and 40% income reduction.
Waiters, etc. that worked much less than I did are getting $600 per week bonus and I get a 40% income reduction. I’m against the payments, etc. but they are going out; so then my view would be ‘what’s fair is fair.’ I know others that managed to “keep their jobs” who are getting po’ed that others essentially in their shoes are essentially getting a $10k free payment.
The statement was meant to convey that those whose circumstance did not change still got the stimuless check, while those who have had hours cut or have moved on to lesser paying jobs are the ones who need the help.
Do you think it is a coincidence that $600/week = $15/hr, the magical wage the dems want for everyone? People will get used to it and demand it, or more, to go back to work.
Socialism, smwocialism, that’s not the point. Point is, why are these benefits in some cases so much higher than what the average worker is earning? Other than full-time vs part-time, sounds to me as if a whole chunk of our workforce has been passed by when it comes to income. Maybe they should earn more to adjust for actual cost of living.
And lets force-liquidate all chinese holdings in the U.S. Especially anything with ties to CCP. More and more evidence piling up this was a bioweapon.
But there is still plenty of evidence that it may have come from the US. And the US was/is working on identical bioweapons. “Let he who is without sin…..”
40 hours at $15 an hour is $600 a week, a ‘living wage’.