Unemployment benefits and going back to work — Opinions
Since the federal government increased unemployment benefits first by $600/week and more recently by $300/week, many people have suggested that this is keeping people from seeking employment. One theory is that if you make more not working, you are not incentivized to work. I was laid off for a few months at the start of the pandemic, and did earn more on unemployment than I had been when working. I didn’t think twice when my company was able to re-hire me, and went back to work. But I have many privileges that make this possible including the ability to work from home, childcare, and an interesting and fulfilling job.
I have been curious to see what people are saying about the unemployment benefit, so I looked for some news articles and discussions of those articles. Governor Gianforte of Montana has decided to stop the extra $300/week unemployment from the Federal Government in the hopes that this will get people back to work in the state. His decision was reported on in an article in Yahoo Money three weeks ago and by a Fox News clip of the Montana Governor four days ago. The two articles each have a bias, the Yahoo Money report interviews someone who thinks this is a bad idea, and gives a number for the people who will be hurt by the action. It also mentioned that unemployment in Montana is at 3.8% (in March and 3.7% for April). The Fox News clip features Governor Gianforte discussing the program, including that it pays $42,000 for people not to work and that closing the program has increased applications for work according to employers.
Recently, I read through around 100 comments on a Reddit post of the Yahoo piece and 100 comments on the Fox News clip. The subreddit in which I read comments is r/economics, which implies that people interested in and aware of economic issues are more likely to be posting and commenting. I read the comments on the Fox News article that appeared with it. I hoped by reading these two sets of comments that I would get a broader set of viewpoints about this issue.
No one said on either site, I am making more unemployed than I would working, so I’m not going back to work. No one even came close. I admit, I was hoping for an anecdote or two along those lines. Of course, I didn’t read all of the comments so maybe I missed it.
On Fox News, 27 of the comments I read were supportive of the governor’s decision — “Way to go, Guv!” or “Come and do that in my state!”. Overall, about one third of the comments were positive and appeared to agree with the theory that cutting these benefits would force people back to work. Some of these comments suggested that as a conservative state, Montana is full of hard workers and that this would move by the governor would incentivize liberals to leave. Other comments ranged over many ideas including:
- Not having unemployment insurance is bad for the country as a whole,
- The governor should take the jobs he wants filled as he doesn’t seem to work hard
- People should be able to train for new jobs while on unemployment
- People want higher wages and health care benefits
- Higher paying jobs haven’t come back yet
- For some high paying jobs, 150 people applied. What should the 149 do when they don’t get the job?
- Undocumented workers usually do these jobs
- The governor should use the tax breaks he gives companies to incentivize them to pay a living wage
- Montana takes in more federal money than it gives in taxes
- One person noted that they went to a McDonald’s and found a sign saying it would close early because it couldn’t staff all of its shifts. They were amazed by this.
On Reddit r/economics, most people noted the low unemployment level and the low wages of the jobs available. They discussed why jobs may not have any applicants beyond just low pay including:
- Not feeling safe if co-workers don’t wear masks or get vaccinated
- Jobs in small towns mean that you have no social life outside of work
- No set schedule so you cannot plan or take a second job
- Real estate prices are sky-rocketing because people from out of state are buying second or third homes
- No benefits or overtime
They also noted that the state’s population is aging and people are retiring early. Some mentioned that early retirement packages were offered at the beginning of pandemic when companies were trying to offload workers. Others noted, as one person on Fox News did, that many of these jobs have been worked by undocumented workers in the past, but the pandemic has meant fewer people are coming to the state to work.
A number of people mentioned that they pay well and give their employees benefits and have never had any trouble fully staffing their workplace. One person noted that he worked somewhere like this that changed policies with a new owner and now has much more staff turnover.
Another person noted that in a small town, you could work three part time jobs for three different businesses that are all owned by the same person. This would mean that you get no benefits and no overtime, and the owner makes lots of money from your labor. A couple of people also built on the idea that employment is difficult in rural areas because of the aging population and the lack of young people.
I was surprised that although two people mentioned child care on reddit, this aspect was mostly missing from the conversation. I had assumed that this was one of the main reasons people wouldn’t be going back to work.
I’m also curious if Governor Gianforte knows about Short-Time Compensation which allows the state to work with corporations to keep people employed but at lower levels. I just learned about this myself from this report by the Roosevelt Institute. Only 27 states participate and Montana is not one of them. Given his statements about the importance of work and dignity, I wonder why not.
