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In more normal times, it makes sense that unemployment should not be lucrative, and workers should be encouraged to take any job at all rather than be unemploye

In more normal times, it makes sense that unemployment should not be lucrative, and workers should be encouraged to take any job at all rather than be unemployed. But the calculus changes in a pandemic, because you want people to stay home, even if they have nothing productive to do there. Low-wage work is almost never remote, so a person working a non-essential, low-wage job is likely not providing enough value to offset the harm they do by spreading COVID at their job site or on public transit. Of course, this is not the function that UI was meant to serve. If it were designed to “compete” with the low-wage job market, it would be paid out even to workers who resign voluntarily or refuse to seek any employment while receiving benefits. But given policy can’t turn on a dime, raising UI is a reasonable way to discourage non-essential work specifically — to the extent work is essential, workers are unlikely to be laid off and made eligible for benefits.

JSavageOne 6y ago
That's a pretty absurd rationalization for paying people more to not work than to work. Also, the article specifically talks about "essential workers" who made more money not working. Wanting people to stay at home is different from paying people to be unemployed.
- goodside 6y ago
  “Essential workers” is a nebulous term - formally there are only “essential businesses” that are allowed to operate, and their employees are informally “essential” too. But only a subset of such workers are necessary. E.g., cleaning staff at hotels might be called “essential workers”, but if the hotels are virtually empty most of those workers aren’t needed. Granting extra UI benefits allows the employer to determine which workers to keep, and compensates those actually laid off to avoid unexpected hardship. None of the essential workers mentioned in the article lost their jobs that I can see. One was just temporarily overpaid for taking an otherwise unpaid leave. They stayed home, and received more pay for doing so. The fact that the UI bonus encourages this behavior (within the bounds that employers tolerate) is exactly the social benefit I’m pointing out in my original comment — the UI benefit encourages people to stay home if they can. The workers in the article are complaining about the unfairness of not receiving extra pay, and justifiably so — it is unfair. The UI benefit helps slow the spread of a deadly pandemic (and mitigates foreseeable bankruptcies/evictions) while also making the world less fair for the people who are still employed. The article only discusses the latter, and I was pointing out the former.
NovemberWhiskey 6y ago
>because you want people to stay home You want most people to stay at home. You want the ones who can work from home to do so. You want your essential workers to go to work. Imagine you have three workers each earning $30K p/a; that's about the 24th percentile for a household in the U.S. One loses their job as a result of covid-19. One can work from home but loses some hours (incomes reduces to $25K p/a). One has to continue working because they're designated as essential. The first worker actually increases their income, because the $600 per week on top of their state unemployment insurance is quite a lot more than their salary. Let's assume they decide to stay safely at home. The second worker suffers a reduction in income, but can stay safely at home. The third worker continues to earn the same, but is exposed to the risks of (e.g.) a public transport commute, being in the workplace and maybe having to face off to the general public. There is clearly a social equity issue of the government compensating people who are 'inessential' and unable to work from home at level above making them whole, while doing nothing for the others.
- goodside 6y ago
  I agree it’s certainly not socially equitable. Laid-off non-essential workers receive an undeserved pay raise for doing no work, and essential workers receive no benefit for continuing to work despite the hazards involved. Mandating hazard pay would be fairer, yes, but has consequences of its own — e.g., some essential employers at the margins of profitability become insolvent, causing less essential work to be done. I’m only saying that as an emergency measure, where your chief concern is short-term continuation of essential work and discontinuation of non-essential work that incentivizes people to leave home, raising UI benefit helps achieve that. Layoffs act as a useful indicator of whether a given pre-pandemic job is actually essential to preserve, and laid-off workers are more tangibly in need of assistance to avoid cascading problems (tenants failing to pay rent, landlords failing to pay property tax, REITs collapsing, pensioners not getting paid, etc.). Giving a windfall to the unemployed is obviously counterproductive in a normal economy, but in the short-term it does solve some problems. Also airdropping money to low-income essential workers would make things more fair, but these workers are not generally facing eviction. Your point about hour reductions may be true in some states — I’m not sure — but at least in mine (New York) workers receive unemployment insurance for any reduction that drops their pay by more than 20%, with benefits proportional to the reduction in hours.

JSavageOne 6y ago

That's a pretty absurd rationalization for paying people more to not work than to work. Also, the article specifically talks about "essential workers" who made more money not working. Wanting people to stay at home is different from paying people to be unemployed.

goodside 6y ago
“Essential workers” is a nebulous term - formally there are only “essential businesses” that are allowed to operate, and their employees are informally “essential” too. But only a subset of such workers are necessary. E.g., cleaning staff at hotels might be called “essential workers”, but if the hotels are virtually empty most of those workers aren’t needed. Granting extra UI benefits allows the employer to determine which workers to keep, and compensates those actually laid off to avoid unexpected hardship. None of the essential workers mentioned in the article lost their jobs that I can see. One was just temporarily overpaid for taking an otherwise unpaid leave. They stayed home, and received more pay for doing so. The fact that the UI bonus encourages this behavior (within the bounds that employers tolerate) is exactly the social benefit I’m pointing out in my original comment — the UI benefit encourages people to stay home if they can. The workers in the article are complaining about the unfairness of not receiving extra pay, and justifiably so — it is unfair. The UI benefit helps slow the spread of a deadly pandemic (and mitigates foreseeable bankruptcies/evictions) while also making the world less fair for the people who are still employed. The article only discusses the latter, and I was pointing out the former.

NovemberWhiskey 6y ago

>because you want people to stay home You want most people to stay at home. You want the ones who can work from home to do so. You want your essential workers to go to work. Imagine you have three workers each earning $30K p/a; that's about the 24th percentile for a household in the U.S. One loses their job as a result of covid-19. One can work from home but loses some hours (incomes reduces to $25K p/a). One has to continue working because they're designated as essential. The first worker actually increases their income, because the $600 per week on top of their state unemployment insurance is quite a lot more than their salary. Let's assume they decide to stay safely at home. The second worker suffers a reduction in income, but can stay safely at home. The third worker continues to earn the same, but is exposed to the risks of (e.g.) a public transport commute, being in the workplace and maybe having to face off to the general public. There is clearly a social equity issue of the government compensating people who are 'inessential' and unable to work from home at level above making them whole, while doing nothing for the others.

goodside 6y ago
I agree it’s certainly not socially equitable. Laid-off non-essential workers receive an undeserved pay raise for doing no work, and essential workers receive no benefit for continuing to work despite the hazards involved. Mandating hazard pay would be fairer, yes, but has consequences of its own — e.g., some essential employers at the margins of profitability become insolvent, causing less essential work to be done. I’m only saying that as an emergency measure, where your chief concern is short-term continuation of essential work and discontinuation of non-essential work that incentivizes people to leave home, raising UI benefit helps achieve that. Layoffs act as a useful indicator of whether a given pre-pandemic job is actually essential to preserve, and laid-off workers are more tangibly in need of assistance to avoid cascading problems (tenants failing to pay rent, landlords failing to pay property tax, REITs collapsing, pensioners not getting paid, etc.). Giving a windfall to the unemployed is obviously counterproductive in a normal economy, but in the short-term it does solve some problems. Also airdropping money to low-income essential workers would make things more fair, but these workers are not generally facing eviction. Your point about hour reductions may be true in some states — I’m not sure — but at least in mine (New York) workers receive unemployment insurance for any reduction that drops their pay by more than 20%, with benefits proportional to the reduction in hours.