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There’s nothing quite like a discussion on unemployment benefits to get Uncle Sam and Aunt Karen riled up. They are convinced that cutting off support for nearly 10 million individuals who rely on these funds is the solution to the workforce shortage. Really? They believe people are opting to stay home because they earn more money not working, rather than acknowledging valid concerns about health risks associated with Covid.
At the onset of the pandemic, businesses were shuttered and employees were laid off en masse. The government faced a harsh reality—without income, the economy was bound to crash. When consumers lack money, the economy stagnates. To counter this, they boosted unemployment benefits and widened eligibility. This financial support allowed many to continue spending, keeping the economy somewhat afloat even as Covid continued its rampage. However, that all shifted on Monday when lawmakers allowed those enhanced unemployment policies to expire after a year and a half.
The Ripple Effects of Cutting Benefits
The deadline for these changes has been looming for a while, yet there was no significant surge in workforce participation. Could it be that the increased benefits weren’t the issue after all? When people lack work or assistance, they have no disposable income. And I’m not just talking about luxuries; I mean the basics. How will families pay for housing? How will they put food on the table? An uncomfortable reality is that just because someone has never faced food or housing insecurity doesn’t mean it isn’t a pressing issue for many—specifically, 1 in 4 households.
Do lawmakers genuinely believe that those receiving unemployment checks are spending it frivolously? The truth is, these benefits are designed to replace lost income, not to fund an extravagant lifestyle. We’re heading back toward the conditions that worried politicians at the start of this crisis.
When people feel financially insecure, they tend to conserve their resources, leading to reduced patronage for local businesses. In turn, these businesses may raise prices or downsize their staff to survive. You see the connection?
While I’ve never personally relied on unemployment benefits, I have worked on the administrative side, interviewing applicants and ensuring program integrity. People aren’t seeking to live off unemployment; they are looking for a bridge to support them during difficult times.
What Would Be More Beneficial?
One significant hurdle for the unemployed is finding the time and means to attend interviews. While virtual interviews have become popular, many positions in customer service or food service still require in-person attendance. When you aren’t working, you’re typically home with your kids, right? But finding childcare for a one-off interview can be a nightmare. Daycares often don’t accommodate drop-ins, and not everyone has family nearby to help.
Even if parents manage to secure an interview and get hired, they must consider the cost of childcare. According to Care.com, families are spending between $340 and $640 a week on daycare—roughly $2,000 or more a month. Those are staggering figures, and they are conveniently overlooked by those who claim people aren’t returning to work simply because unemployment pays better.
And what about individuals without children? Lawmakers often overlook that Covid remains a serious threat. Prospective employees need to consider the potential exposure risks when taking a job. If they contract the virus, will their employer provide affordable healthcare or enough paid time off to recover?
The questions are endless, and the uncertainty is daunting. One thing is clear: cutting off unemployment benefits for millions was not the solution. This drastic move will have ramifications that extend beyond individuals, affecting the economy, small businesses, and every American citizen.
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