Democrats have exploited the Coronavirus pandemic to expand unemployment benefits in order to subsidize welfare over work.
In March, Congress passed the Coronavirus Aid, Relief, and Economic Security (CARES) Act. As a condition of supporting this legislation, Democrats demanded a $600 per week unemployment expansion for individuals on top of their existing state benefits.
While Americans that have lost their jobs certainly need help, this new program has created a situation in which individuals are being paid more to sit at home than they were making in the workforce.
According to the Heritage Foundation, a job would have to pay more than $62,000 a year to exceed the left’s unemployment expansion. The Congressional Budget Office estimates that five out of six Americans on unemployment are receiving more than they were making in their jobs, creating a massive disincentive for Americans to return to the workforce as the country reopens.
Democrats are now pushing to extend the $600 UI program past the election. House Democrats recently passed the Health and Economic Recovery Omnibus Emergency Solutions (HEROES) Act, a massive 3 trillion-dollar liberal wish list that extends the Democrat UI expansion through January 2021.
If Congress continues to subsidize welfare over work, it will jeopardize our post-pandemic recovery and force hundreds of thousands of small businesses to shut their doors permanently.
This is not theoretical. Here are real-world examples of American businesses struggling to bring back workers because they cannot compete with Democrat Party’s new welfare program:
Jamie Black-Lewis, a Washington-state based spa owner said that her employees were angry about having to give up their unemployment and return to work. As noted by an April 22 CNBC report:
When Black-Lewis convened a virtual employee meeting to explain her good fortune, she expected jubilation and relief that paychecks would resume in full even though the staff — primarily hourly employees — couldn’t work.
She got a different reaction.
“It was a firestorm of hatred about the situation,” Black-Lewis said.
Liz Blondy, a Detroit based dog day care owner had to lay off 90% of her staff; thus, dropping her business by 95%. Many business owners struggle with the fact that travelling to work may be risking during a pandemic. As noted in an April 11 New York Times article:
When Michigan’s stay-at-home order was announced, Ms. Blondy laid off 70 of her 90 workers and saw her business drop by 95 percent.
Now, she is… considering bringing her team back.
But some of the workers have said they’d rather stay on unemployment or be laid off.
Carl Livesay, vice president of operations for a Baltimore-based manufacturer Maryland Thermoform Corporation. is struggling to find workers to show up for interviews. According to a May 23 CBS19 report:
“It’s been very difficult to get some people to return to work,” Livesay, the vice president of operations for Maryland Thermoform Corporation, told ABC News.
“We’re interviewing three to five people a day for jobs we have open, and we can’t even get them to show up for interviews.”
Nabil Cabbabe, president of the Bank of Houston/Spirit Bank in Missouri feels though the situation brought on by the government programs put some businesses in an undesirable situation. This is noted in an April 22 Forbes article:
“We’re not really sure what to do,” says Nabil Cabbabe, president of the Bank of Houston/Spirit Bank in Missouri who also runs an after-school gymnastics center that received a PPP loan. “It’s tricky. They’ve kind of pitted us against our employees a little bit.”
Sky and Geoff Marietta, the married couple who owns a coffee shop in Harlan, Kentucky are contemplating that it is a logical choice for a lot of their employees to stay unemployed-for their own benefit, as stated in an April 21 NPR report:
“The very people we hired have now asked us to be laid off,” Marietta wrote in a blog post. “Not because they did not like their jobs or because they did not want to work, but because it would cost them literally hundreds of dollars per week to be employed.”
Ian Lieberman, a multi-unit franchisee for Fuzzy’s Taco Shop in Tampa, FL. The extra $600 boost to unemployment is making it difficult for some small-business owners to hire laid-off workers, as Liaberman noted in an April 26 Business Insider article:
“We have had many staff that have said at this point the best thing they can do for their family is to collect unemployment,” said Ian Lieberman, a multi-unit franchisee for Fuzzy’s Taco Shop in Tampa, Florida. “When they explained their reasoning, I said I respected that and that they would be available for rehire.”
Adam Lowe, the co-owner of Sundara Indian Cuisine in San Diego, has felt frustration regarding hiring employees over the past few weeks, as reported in an April 26 Business Insider article:
Adam Lowe, the co-owner of Sundara Indian Cuisine in San Diego, said he “ran into a wall” trying to hire cooks for his restaurant over the past few weeks.
“Everyone I was talking to was going on unemployment and getting raises,” said Lowe, who pays cooks about $20 an hour.
“The $600 weekly payout has derailed the system,” he said.
Curt Blackwell owns two restaurants in central Missouri and has to go against the unemployment bonus in order to retain employees, according to an April 26 Business Insider report:
Curt Blackwell, who owns two restaurants in central Missouri, said he had received $90,000 in forgivable loans through the federal Paycheck Protection Program to stay afloat. The program requires that recipients spend 75% of PPP funding on payroll.
But Blackwell said it had been hard to persuade his laid-off staffers who were receiving unemployment benefits to come back to work.
Alex Shahabe is the owner of PC Housing. His company provides temporary housing to corporate workers and military personnel on short-term assignments across the globe. When trying to hire back the employees he had to lay off, he was up against the fact that they were making more money with this subsidy, as reported in a May 12 Providence Journal article:
“We had a couple people say: Wait a minute, I am making more being unemployed,” Shahabe said. “The conversation we had was do you want a secure job and for us to figure out how to move forward, or would you rather be on unemployment, and how long will that last?”
Steve Anthony, CEO of Anthony Timberland’s pine mills in Arkansas, found that many of his workers wanted to be laid off and receive unemployed, according to an April 4 article appearing in the Arkansas Democrat & Gazette:
Some 200 workers at Anthony Timberlands’ pine mills in Malvern and Bearden will be laid off temporarily, in part because they prefer to receive unemployment checks that will be larger than their take-home pay, Steve Anthony, the company’s chief executive officer, said.
Lia Hakim, owner of Hott Salons, in New York, found that her employees did not want to return to work, instead preferring to stay on unemployment where they would earn more. As noted in a May 11 CNBC article:
Meanwhile, her entry-level employees are reluctant to return. “They don’t want to come back,” she says. “They’re making more money sitting at home.” She is referring to the $600 bump up in unemployment checks under the CARES Act added to traditional unemployment checks, which in New York State max out at $504 a week.