If you have a business you know that what a business needs is customers. If your customers fall on hard times, YOU fall on hard times. Supposedly each dollar of Unemployment Insurance causes 2.15 in economic activity. Actually I believe that the multiplier effect is actually much higher. If UI is allowed to expire on March 1, 1.3 million people will loose what little UI they recieve. That means that a number of grocery stores, doctors, rental property owners, gas stations, and banks who extentded car loans and credit card loans to people when they HAD jobs, and everyone else that those on UI do business with, will be in deep trouble and laying off 30-60 days later.
Unemployment Insurance "benefits" do truly cause increased economic activity above and beyond the security they provide for the people they are paid to. The PROBLEM I have with it (and as a self-employed person I have never been able to apply for benefits myself) is that people get to collect and still DO NOTHING in the meantime. They just hang out, they are SUPPOSED to be looking for work, but thats a joke, I know many people that are collecting, and there are a million ways to never have to actually do anything while collecting. A much smarter way to administer these benefits would be to put anyone who collects TO WORK for the state in whatever capacity translates best to their area of competence. There are TONS of state workers doing any number of jobs that a benefits-collecter could do just as well...so the state can save money by not having to pay a normal state employee for that position, and the collector doesnt just get to sit around and collect a check. If something like that was instituted, states could AFFORD to have benefits periods automatically run for longer periods, maybe up to 3 or 4 years, to give time for these people to retrain into fields of their choosing. The current system is so flawed. A bunch of people sit around and collect free money with little or no incentive to do anything about it but complain and yet worry about the looming benefits cutoff. Stupid.
My unemployment insurance was 2.9% for the past decade. I just got my premium reset to 8.9%. If and when I hire new employees it is going to cost me over 1$ an hour more to rehire some of the guys back. After 20 years of putting money into the system my account is now in the rears and I can look forward to have this rate for many years to come. I know what all do, I'll just raise my prices. Nah that won't work I'll just hire them back for less money and benefits.
Like Best Buy.... fired all $18/hr "senior" sales people. Told them they could "reapply for employment" at $9/hr
Yes, I know of a few small businesses that are going to see their premiums skyrocket due to the fact of laying off people for the last 2 years. The sad part about the whole situation is that they have been in business for over 30 years, this is the first time they ever had to lay anyone off. Once these premiums rise for the millions of small businesses across the country it will just be another problem for them moving forward. Raising prices will not work in these economic conditions.
Yes bankrupt circuit city did that in 2007. Laid off thousands of workers to replace them with lower paid employees.
Then the state workers would lose their jobs!! Also if those receiving benefits have to work full-time for the state, they won't be able to go out for job interviews. It may be a good idea for those receiving extended benefits to be given some part-time work to do that is needed by the community but left undone...while they continue to look for a real job. I don't get any unemployment benefits as I worked on a 1099 contract basis.