Wednesday, September 8, 2010
Do unemployment checks keep the jobless at home?
Is unemployment compensation keeping the unemployment rate up? According to Harvard University Professor, Robert Barro, in some way, people are getting paid for being unemployed. Thus, they have no incentive to look for jobs.
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I can see a lot of validity in this argument. While unemployment benefits may not stop me from looking for a job, they would certainly stop me from accepting a job I think may not match my past job’s level. Once I stop receiving benefits, however, I’m much more likely to accept what comes my way. The only problem is that while I’m employed I may be underemployed are unhappy. Therefore, I’ll only stay in my new position until I find a replacement.
ReplyDeleteThe intended goal of the unemployment check is to give the person the bare necessities while the person looks for a job. There has to be a fine line between "feast" and "famine" so that the job seekers are not hurting yet not living off the check.
ReplyDeleteI believe that in order for the unemployment payment system to work is if the government decides to track those who aren't lazy and spend their days looking for employment. For the meantime, i think that people are getting increasingly lazy because they are losing the incentive to work when their unemployment checks are enough to get them by. Why find a job when I can get paid for staying home all day?
ReplyDeleteI agree with what Michael said, the goal is to help the person that is unemployed (whether having a family or not) to be able to provide for themselves/and others. I think it depends on how dependent that person is of the job they lost and how much benefit they really do need. This might make some lazy to an extent, but I don't think the unemployed want to stay unemployed forever and just live off what they are given. Unemployment is tough and I am sure if it was easier to find a job right now, the unemployed would.
ReplyDeleteIt would depend on whether or not the amount they receive on unemployment exceeded the amount they could receive with their skill level in the labor force. I doubt this is often the case as unemployment benefits are generally just enough to keep the family above the poverty level. The article also discounts the sacrifice of human dignity and the social isolation that comes with unemployment. There are few indeed who would actually aim to remain in that state
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