What COVID Unemployment Payouts Mean for Our Economy | Sapling

What COVID Unemployment Payouts Mean for Our Economy

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The number of Americans claiming unemployment benefits during the COVID-19 outbreak is staggering: This week, it spiked to 36.5 million, which is definitely an undercount. We're just two percentage points away from the lows of the Great Depression. Things are dire, and we're feeling it.

The federal CARES Act, passed at the end of March, has staunched the problems somewhat, but rollout has been uneven as access to unemployment programs is stymied by the huge demand. Still, those who have been able to start claiming their payouts — plus the $600 weekly add-on from the feds — are finding something both shocking and darkly welcome: They really are making more from unemployment than they were in their full-time jobs.

FiveThirtyEight reports on a new study from the University of Chicago that confirms this point of contention among some politicians. Rather than disincentivize workers to return to their jobs, it demonstrates another truth that the coronavirus pandemic is laying bare. If it's more profitable to be on unemployment than to work a low-wage job, our low-wage earners deserve higher pay. Almost 40 percent of U.S. workers who earn $40,000 or below lost a job in March, which means the people living with the most day-to-day precarity are bearing the brunt of this worrisome economy.

We've known for a long time that the federal minimum is insufficient to support workers, no matter where in the United States they live. If you have strong feelings about the issue, it never hurts to contact your elected representatives and let them know.