Incentive Not to Work

In contrast to the PolitiFact about which I complained, yesterday, this one by Eugene Emery was actually informative. The statement under scrutiny was from Republican candidate for governor John Robitaille, that “Rhode Island has a very generous unemployment compensation rate compared to most other states”:

By the latest measurement, during the first quarter of 2010 Rhode Island ranked second in the nation. The state paid the typical recipient 47.8 percent of the average weekly wage of $816.71. (Hawaii topped the list, at 54.8 percent. Massachusetts, by that measure, was at 37.3 percent, ranking it 29th.)
Put another way, the average hourly wage in Rhode Island during the first quarter of 2010 was $20.42. The average person receiving unemployment insurance got the equivalent of $9.76 per hour. The benefit could be as much as $13.76 an hour for an individual or $17.20 per hour for someone with five or more dependents.

Robitaille’s contention is that unemployment benefits so high discourage people from going back to work once unemployed. I’ve actually run into that dynamic, with a new carpenter who spent most of the single day that he worked with my company telling another new guy how nice it was to be able to go fishing and such while receiving a government subsidy.
It’s important to note that unemployment needn’t exceed the pay rate that a potential worker could expect. It just needs to be more than he or she requires to live an acceptable lifestyle.

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Swazool
Swazool
10 years ago

I would have to guess that the guy who said it was nice to be on unemployment was a single, young man who didn’t have responsibilities, probably lives at home.
Try paying bills on unemployment or feeding a family, there is a big difference.

Justin Katz
10 years ago

Actually, he was older (probably in his mid-to-late ’40s), with at least one teenage daughter.

BobN
BobN
10 years ago

Well, then, Swazool, if you’re not satisfied with living on unemployment checks you’ll just have to go out and get to work.

Warrington Faust
Warrington Faust
10 years ago

A little rality check here. I know a number of guys, highly skilled in manufacturing jobs, that are receiving unemployment.
The truth is that they will never work in those jobs again. In any other field, they are “unskilled”. That means, if they could find work, they would make less than they do on unemployment.
This is a very strong argument for remaining on unemployment.

Patrick
Patrick
10 years ago

“This is a very strong argument for remaining on unemployment.”
Warrington, I’m guessing you mean from *their* perspective. Yes, it is. Then again, if they had any sense of pride, they might take advantage of worker education programs that the state offers, or actually go learn a trade. Or heck, go flip burgers at McDonalds and work their way up to being a store manager, regional manager, etc. jobs that come with great benefits and compensation.
Then again, lying on the couch all day and watching Judge Judy and lawyer ads while getting stoned and drunk on taxpayer money because they got “screwed” out of their job does sound pretty good too.

Swazool
Swazool
10 years ago

I am not on unemployment.
But I will tell you that the industry I am in does very very well when the jobs numbers come out! I have been having my best years these past few years. I knew when the economy was starting to sour I was going to have my best years, and it looks like I will have 3-4 more years at this record growth before it levels off.
I am working 6 days a week, sometimes 7 because I am trying to keep up. I don’t take holidays, yes I worked on Columbus day (and July 4th this year) so when you say Unemployed I have to laugh.

Warrington Faust
Warrington Faust
10 years ago

Swazool,
Any of us who has been self employed knows what it means to look blankly when someone says “what are you doing with the long weekend”, and understand that “12 hours is only half a day”.
Patrick,
Yes, I do mean from “their perspective”. But it is not unreasonable. They are in their late 50’s, early 60’s. They are never going to find another job. Many are eating pasta and dedicating the unemployment to paying off the last few remaining years on their mortgage. The only hope is “self employment”. One has started using his machine skills by going from gas station to gas station, repairing hydraulic jacks. He will never approach the 60K he made as a toolmaker. I just had some paint work done by a former diamond setter/engraver. At their age, “obamacare” has made employment prospects very dim indeed.
Do I suspect that they are doing odd jobs, and trying to let unemployment pay off thier mortgages? Yes, I do. It isn’t that they “quit”, their industries quit them. While their jobs were available, they worked long and hard. One problem they have is that they were always “employed”. They did as directed, but never learned to “go find something that needs doing”.

Swazool
Swazool
10 years ago

Has anyone read the article on how many millionaires collect unemployment?
http://www.dailyfinance.com/story/investing/millionaires-on-unemployment-there-has-to-be-a-better-system/19657740/
“According to Bloomberg News, data from the IRS shows that 2,840 households reporting at least $1 million in income on their tax returns that year also collected a total of $18.6 million in unemployment benefits in 2008. There were 806 taxpayers with incomes over $2 million and 17 with incomes in excess of $10 million collecting benefits. Data from 2009 was not available but odds are that the figures haven’t changed much, given how the economy continues to struggle to rebound.”
See full article from DailyFinance: http://srph.it/9Yzg8y

Patrick
Patrick
10 years ago

Swazool, with the many thousands of dollars that they pay into the system, are you saying that they’re not entitled to unemployment benefits when they are laid off?

Swazool
Swazool
10 years ago

No, I didn’t say that.
I will lay myself off next year and collect too.
Will I be comfortable?
He’ll yeah!
Are the other millionaires that do it comfortable,
Yup.
Are the people who need the money “comfortable” …no, probably not

Phil
Phil
10 years ago

Who do we hate more?
a.) Liberals that caused high unemployment with their stupid policies ( this one is for Mike Capelli)
b.) Unions whose members work and are not on unemployment. (they don’t live in the real world)
c.) People who have been laid off and are collecting unemployment during this global,economic recession. (See Patrick for a colorful description of these leeches)
d.) Mexicans (needs no explanation)

David S
David S
10 years ago

Phil- you left out the “e” – as in -all of the above-. A fine whine has many parts. True conservative patriots have always spread the blame around. Blame the alien invaders. The outsiders and the illegals. And these patriots want to and do –profit from war, profit from fear,- AND –still– get some of that cheap labor. See Meg for some domestic help advice.

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