Tuesday, May 29, 2012

Suddenly Starting a New Job after 79 Weeks of Unemployment

On the 12th of this month, unemployment benefits were terminated for persons living in Illinois who had so far been unemployed and collecting benefits for 79-99 weeks.

The New York Times interviewed one of the persons affected, Candace Falkner, 50. Persons, like Ms. Falkner, who are unemployed for 79 weeks or more are often described as being unable to find a job. They would never turn down a job just because they were receiving unemployment benefits.

Yet, according to the New York Times, Ms. Falkner is working now, only a week or two after her unemployment benefits ran out. With no jobs to be found for the prior 79 weeks, did Ms. Falkner's job coicidentally appear?

The story describes Ms. Falkner's new job as "a commission-only, door-to-door sales job," and describes Ms. Falkner as a person with a master's degree, so I think we are to understand that Ms. Falkner is qualified for a better job than that. If so, it seems the 79+ weeks that she was unemployed cannot be described as a time when there were no jobs to be found, but rather a time when there were no "good" jobs to be found.

That's exactly the story I have been telling on this blog for several years: unemployment insurance makes unemployment last longer, even while it goes to people in unenviable situations. It also raises wages, as the jobs that are not good enough for the unemployed to accept either go unfilled or are not created in the first place.

Perhaps these consequences are desirable or at least tolerable for the intrinsic benefit of knowing that taxpayers are helping people when they experience tough times. But they are consequences nonetheless: the fact is that some of the reason that the unemployment rate is 8 percent rather than 5 is that unemployment is subsidized.

2 comments:

Daniel Stone said...

I wonder if this commission only sales job covers costs of employment, let alone costs of living.

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