Things are getting weird. I’m not sure how many people are even going to want to go back work at a normal job after a month or two.
A lot of people losing their jobs are people making less than $20/hr, and right now unemployment pays more than working. In fact, in California if you make under $25/hr your unemployment check will be bigger than your regular check. This only goes to July 31, but this sort of distortion is going to completely upend the labor market. If you made between $7.25 and $25 an hour there is little incentive for you to look for a job until July 31.
Social distancing in some form will likely continue through June, at least. So I doubt the economy snaps back overnight and everyone gets rehired in a months time. So there is your extra slack. However you haven’t experienced this situation nor thought about it much so let me enlighten you about how there is no extra incentive to stay unemployed.
If you happen to have benefits, you lost them with unemployment. Matched retirement contributions, health insurance, tuition reimbursement, etc.
Do you know how much full insurance premiums are for most plans with COBRA? My brief unemployment experience showed me that just for me it ended up being nearly 700 a month and that’s someone in their late 20’s at the time with not the best healthcare plan I could have gotten but the middle range one with a 1500 deductible. For a family of 4? Easily 2k.
What you’re saying is we shouldn’t pay people to also sort of kinda have enough money to continue health insurance during a pandemic??? For those to don’t have it and do get sick enough to need care there goes a good portion of that extra money and likely even more, especially if it involves hospitalization - without insurance or a job they’ll likely be bankrupt unless that happen to have a lot in savings.
You also have to skip a week with unemployment before taking the benefit, that’s a week lost income. Finally only in the states with the best benefits, eg NY pays 80% of your salary, do you possibly come out ahead. Some states only pay 45-50% cause they don’t fund their versions as much comparatively.
Additionally unemployment is backlogged that means delayed payments and thus people will possibly incur late fees, interest and other penalties and costs associated with that.
Finally even if somehow someone comes out ahead due to being in a state that gives you a high percentage of your over all income, the amount of situations like that is small and if it happens it is likely a marginal increase at best. Considering we are likely not going to have enough jobs to get people back to work in any significant numbers by July anyway, consider any increase after all that a slight additional stimulus check for people who have been impacted by this and happen to also be low wage workers.
We decided to furlough people so they could keep their benefits. Also paid out their PTO balance which should hold them over until unemployment kicks in.
Here in California someone making $15/hr was making $600/wk. On unemployment they will now make $877/wk. That’s a 46% increase. It’s huge. We were trying to keep people employed while staying home but people literally started filing for unemployment anyway.
Did you offer health insurance? Again COBRA costs will easily take that extra $277 per week or more if you have a family. This situation is limited, it only applies to the few states with good unemployment compensation, if the person is a minimum wage worker and also if that someone didn’t have insurance, doesn’t opt for cobra (or has been picking up a separate plan through the ACA exchanges) and/or its just coverage for themselves for cobra then they might come out ahead. This extra money lasts until July and that’s it.
I’m guessing some people might rethink it when they see the costs of cobra and the fact that the sooner they hit the unemployment compensation the sooner they start the clock of limited benefits. If they need it for more than 6 months or whatever the state allows the max to be then they’re going to regret not first going for being furloughed. Unfortunately people also aren’t rational or forward thinking.
The way they did unemployment insurance certainly isn’t perfect in the stimulus bill. But I don’t think it’s all that problematic.
We pay 100% health insurance and will try to keep it as long as possible while they are furloughed. Things change day to day though. A number of our buyers, including some large public companies, decided to just stop paying their bills by switching to net-180 terms.
I can tell you right now most $15/hr employees aren’t too worried about health insurance. Most of them have gone their entire life without, so suddenly losing it again isn’t as big a deal as you might think.
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Things are getting weird. I’m not sure how many people are even going to want to go back work at a normal job after a month or two.
A lot of people losing their jobs are people making less than $20/hr, and right now unemployment pays more than working. In fact, in California if you make under $25/hr your unemployment check will be bigger than your regular check. This only goes to July 31, but this sort of distortion is going to completely upend the labor market. If you made between $7.25 and $25 an hour there is little incentive for you to look for a job until July 31.
Social distancing in some form will likely continue through June, at least. So I doubt the economy snaps back overnight and everyone gets rehired in a months time. So there is your extra slack. However you haven’t experienced this situation nor thought about it much so let me enlighten you about how there is no extra incentive to stay unemployed.
If you happen to have benefits, you lost them with unemployment. Matched retirement contributions, health insurance, tuition reimbursement, etc.
Do you know how much full insurance premiums are for most plans with COBRA? My brief unemployment experience showed me that just for me it ended up being nearly 700 a month and that’s someone in their late 20’s at the time with not the best healthcare plan I could have gotten but the middle range one with a 1500 deductible. For a family of 4? Easily 2k.
What you’re saying is we shouldn’t pay people to also sort of kinda have enough money to continue health insurance during a pandemic??? For those to don’t have it and do get sick enough to need care there goes a good portion of that extra money and likely even more, especially if it involves hospitalization - without insurance or a job they’ll likely be bankrupt unless that happen to have a lot in savings.
You also have to skip a week with unemployment before taking the benefit, that’s a week lost income. Finally only in the states with the best benefits, eg NY pays 80% of your salary, do you possibly come out ahead. Some states only pay 45-50% cause they don’t fund their versions as much comparatively.
Additionally unemployment is backlogged that means delayed payments and thus people will possibly incur late fees, interest and other penalties and costs associated with that.
Finally even if somehow someone comes out ahead due to being in a state that gives you a high percentage of your over all income, the amount of situations like that is small and if it happens it is likely a marginal increase at best. Considering we are likely not going to have enough jobs to get people back to work in any significant numbers by July anyway, consider any increase after all that a slight additional stimulus check for people who have been impacted by this and happen to also be low wage workers.
We decided to furlough people so they could keep their benefits. Also paid out their PTO balance which should hold them over until unemployment kicks in.
Here in California someone making $15/hr was making $600/wk. On unemployment they will now make $877/wk. That’s a 46% increase. It’s huge. We were trying to keep people employed while staying home but people literally started filing for unemployment anyway.
Did you offer health insurance? Again COBRA costs will easily take that extra $277 per week or more if you have a family. This situation is limited, it only applies to the few states with good unemployment compensation, if the person is a minimum wage worker and also if that someone didn’t have insurance, doesn’t opt for cobra (or has been picking up a separate plan through the ACA exchanges) and/or its just coverage for themselves for cobra then they might come out ahead. This extra money lasts until July and that’s it.
I’m guessing some people might rethink it when they see the costs of cobra and the fact that the sooner they hit the unemployment compensation the sooner they start the clock of limited benefits. If they need it for more than 6 months or whatever the state allows the max to be then they’re going to regret not first going for being furloughed. Unfortunately people also aren’t rational or forward thinking.
The way they did unemployment insurance certainly isn’t perfect in the stimulus bill. But I don’t think it’s all that problematic.
We pay 100% health insurance and will try to keep it as long as possible while they are furloughed. Things change day to day though. A number of our buyers, including some large public companies, decided to just stop paying their bills by switching to net-180 terms.
I can tell you right now most $15/hr employees aren’t too worried about health insurance. Most of them have gone their entire life without, so suddenly losing it again isn’t as big a deal as you might think.