What’s Keeping Workers at Home: Unemployment Pay or Low Wages?
Updated: 9:36 AM CDT May 16, 2021
What’s Keeping Workers at Home: Unemployment Pay or Low Wages?
Updated: 9:36 AM CDT May 16, 2021
THE LONG TERM. SOLEDAD: WE KNOW THE COVID-19 RECESSION HIT SERVICE, RETAIL, TRAVEL AND HOSPITALITY INDUSTRIES THE HARDEST. THOSE MOST AFFECTED BY JOB LOSS -- LOWER INCOME WORKERS, WOMEN, AND PEOPLE OF COLOR. THE SUPPLEMENTAL UNEMPLOYMENT PAYMENTS HAVE PROVIDED CASH TO PAY RENT, BUY FOOD, AND COVER MEDICAL AND UTILITY BILLS. THEY HAVE BECOME A LIFELINE FOR RECIPIENTS. BUT ARE THEY DISCOURAGING PEOPLE FROM GETTING BACK TO WORK? WE ASKED LABOR ECONOMIST VALERIE WILSON, OF THE ECONOMIC POLICY INSTITUTE, TO GIVE US HER PERSPECTIVE. VALERIE: THE IDEA THAT OVERLY GENEROUS UI BENEFITS ARE KEEPING PEOPLE FROM TAKING JOBS IS NOT A NEW ONE. WE HEARD MANY OF THE SAME ARGUMENTS COMING OUT OF THE GREAT RECESSION, AND THERE WERE STATES THAT DECIDED TO MAKE SHARP CUTS IN UI BENEFIT ELIGIBILITY AS A RESULT OF THAT. HOWEVER, EMPLOYMENT IN THOSE STATES DID NOT GROW ANY FASTER AFTER THE CUTS THAN IT WAS GROWING BEFORE THE CUTS. AND IN FACT, WE’VE ACTUALLY HAD PRETTY STRONG EMPLOYMENT GROWTH OVER RECENT MONTHS, ALTHOUGH IN APRIL THINGS SLOWED A BIT. THE STRONGEST GROWTH IN APRIL WAS IN THE LEISURE AND HOSPITALITY INDUSTRY THAT STANDS IN CONTRADICTION TO THE IDEA THAT PEOPLE ARE NOT COMING BACK TO WORK BECAUSE OF UI BENEFITS, BECAUSE PEOPLE IN LEISURE AND HOSPITALITY ARE MORE LIKELY TO BE LOW WAGE WORKERS WHO WOULD BE ELIGIBLE FOR A BENEFIT THAT MAY BE HIGHER THAN THEIR REGULAR PAY. THE OTHER THINGS THAT WE KNOW ABOUT PEOPLE IN LEISURE AND HOSPITALITY INDUSTRY IS THAT THEY’RE ALSO MORE LIKELY TO BE IN JOBS THAT REQUIRE THEM TO BE IN PERSON AND HAVE A LOT OF IN-PERSON CONTACT. SO IF EMPLOYERS IN THAT INDUSTRY NEED MORE WORKERS, IT’S REASONABLE THAT THEY WOULD OFFER HIGHER WAGES TO COMPENSATE THOSE PEOPLE IN PART FOR THE INCREASED RISK THAT THEY FACE IN COMING BACK TO WORK. WE ALSO KNOW THAT LARGE NUMBERS OF WOMEN WORKERS ARE IN THE LEISURE AND HOSPITALITY INDUSTRY, AND DURING THE PANDEMIC, WOMEN’S EMPLOYMENT HAS BEEN CONSTRAINED DUE TO CARE RESPONSIBILITIES, SINCE MANY SCHOOLS AND DAYCARES ARE EITHER STILL CLOSED, OR OPEN ONLY ON A LIMITED BASIS. THIS SIMPLY IS NOT THE TIME TO START MAKING CUTS TO A PROGRAM THAT HAS BEEN SUCH A VITAL LIFELINE TO MANY OF OUR COUNTRY’S MOST VULNERABLE WORKERS AND THEIR FAMILIES, AND CERTAINLY NOT UNDER THE GUISE OF SOLVING A PROBLEM THAT THE
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What’s Keeping Workers at Home: Unemployment Pay or Low Wages?
Updated: 9:36 AM CDT May 16, 2021
Business owners across the U.S. say they can’t find enough workers. Right now, the U.S. unemployment rate stands at about 6 percent and millions of people are actively looking for a job. But some have suggested $300 per week in supplemental unemployment benefits is keeping low-income workers from returning to work. For many people, that’s more than they made while on the clock and it has become a lifeline. To help frame the debate, we ask labor economist Valerie Wilson to unpack what the numbers really tell us, and provide context for what the future of work looks like in high contact industries.
Business owners across the U.S. say they can’t find enough workers. Right now, the U.S. unemployment rate stands at about 6 percent and millions of people are actively looking for a job. But some have suggested $300 per week in supplemental unemployment benefits is keeping low-income workers from returning to work. For many people, that’s more than they made while on the clock and it has become a lifeline. To help frame the debate, we ask labor economist Valerie Wilson to unpack what the numbers really tell us, and provide context for what the future of work looks like in high contact industries.
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