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The notion that extended benefits during a pandemic to unemployed workers caused greater/continued unemployment in the US service industry is a theory that has
by exogenousdata 5y ago
The notion that extended benefits during a pandemic to unemployed workers caused greater/continued unemployment in the US service industry is a theory that has yet to be proven. Some early data[0] suggests that the theory fails to accurately predict behavior.
[0] https://www.cnbc.com/2021/08/04/early-end-to-federal-unemployment-pay-in-26-states-not-getting-people-to-work.html https://www.cnbc.com/2021/08/04/early-end-to-federal-unemplo...
- bko 5y agoThere are definitely cases where the benefits are greater than the pay for many employees. > The enhanced payments create a tricky situation for restaurant owners, especially in states such as Georgia and Alaska that are looking to restart businesses in the coming weeks. Nationally, median hourly pay in food-service occupations was $11.65 in 2019, or $466 for a 40-hour week. In some states, restaurant workers could be receiving double their usual pay on unemployment benefits. Natural experiments and studies are very difficult and easy to manipulate. So I think we can use first principles to tell us that if you pay people not to work, they will be more inclined to not work. I think you would need to definitively prove this not to be the case https://www.wsj.com/articles/coronavirus-relief-often-pays-workers-more-than-work-11588066200 https://www.wsj.com/articles/coronavirus-relief-often-pays-w...
- deleted 5y ago[deleted]
- nickff 5y agoThere was a great deal of study on the effect extended unemployment benefits during the great recession, and that seemed to show that it reduced people's propensity to apply for (and get) jobs. It would seem that the effect will be similar in this episode, though it certainly warrants further examination.