Should the Economic Relief Related to COVID-19 Continue?

One perspective to consider

SOME BACKGROUND FIRST

The CARES act, passed in late March, supplemented the income of individuals forced to file for unemployment as a result of COVID-19 shutdowns. As of midnight July 31, 2020, the Pandemic Unemployment Assistance program (CARES act) ended as did the eviction moratorium.

This program gave those people who lost a job due to COVID-19 OR who chose to shelter-in-place because they were in a high-risk category an extra $600.00 a week. Extra because this $600.00 is on top of the unemployment benefits, they get from the state. The program also gave many people an extension on their rent. Although this did not wipe out the rent owed, it did stop landlords from evicting their tenants and in some cases eliminate late fees.

In addition, one of the stimulus packages gave most adults $1,200.00 in a one-time payment and parents an additional $500.00 per child under the age of 16.

Now, the senators and representatives are arguing about how to move forward: some want the $600.00 extended if not increased while others want the amount dropped because it has been a dis-incentive to return to work.

Let’s take a closer look:

My oldest son’s place of employment did not close down. He works in an industry that builds some type of hydraulics for some type of equipment. (And yes, he has told me all about what he does, but the mechanics of it is way over my head.) He goes to work, but the factory was late in following complete safety measures; however, at home, they practice extreme safety measures because his wife falls into one of the “at-risk” categories.

Some of the employees where my son works, however, chose to stay home, collect unemployment, and receive the $600.00 a week stimulus. My son, however, who chose to work did not receive any extra benefit for staying at work. He is, however, irritated that while he works hard and puts himself in a position to contract COVID, he receives nothing extra. Now, my son tells me, several of the people who chose to stay home are refusing to come back, not because they are afraid of catching the virus, but because they make more by staying at home.

As I figure it, you would have to make $15.00 AFTER taxes and paycheck deductions AND work a 40-hour week to end up with $600.00 a week.

It is, however, ironic to me that people who were only working part-time jobs also received $600.00 a week.

Now, let’s look at some totals:

Let’s say you worked at one of the businesses that was considered non-essential, and you found yourself unemployed when they shut their doors.

First, you apply for unemployment. The way unemployment benefits are calculated differs from state to state and is based on the history of your earnings; therefore, what you receive is based on the state you reside and how much you have earned.

According to Workplace Fairness, this amount ranges from $5.00 (as a minimum in Hawaii) to $722.00 (as a cap in Massachusetts).

I live in Tennessee, so I’ll use their figures. According to “Collecting Unemployment Benefits in Tennessee,” I would qualify for no less than $30.00 weekly but no more than $275.00 weekly.

Line 1 — Let’s say I qualify for $122.50 a week (That’s half-way between $30.00 and $275.00.)

My spouse was also laid-off due to COVID-19. She gets unemployment benefits as well.

Line 2 — Let’s say my spouse qualifies for $125.00 a week also.

Line 3 — We both qualify for the $600.00 federal Pandemic Unemployment Assistance.

Line 4 — We both received the $1,200 stimulus check.

Line 5 — We have four children who were under the age of 16 and qualified for the $500.00 check from the federal government.

If we were lucky enough to get in at the beginning of the Pandemic Unemployment Assistance, we would have received benefits for 20 weeks.

Let’s look at the totals for one month with just our unemployment and the Pandemic Unemployment Assistance:

Line 1: $122.50 (Me)

Line 2: $122.50 (my spouse)

Line 3: $600.00 (Me)

Line 4: $600.00 (my spouse)

TOTAL: $1,445.00 (per week)

TOTAL: $5,780.00 (per month)

TOTAL: $28,900 (for the 20 weeks)

The second total line above, $5,780.00, is more than most people receive in Social Security benefits, most of whom worked hard for 50 years of their lives or better.

With $5,780.00 a month, here are some things to consider.

Now, even if rent was $2,000.00 a month, that leaves $3,780.00 for the rest of my bills, food, fuel for the vehicle, and entertainment.

Utilities vary from household to household. My electric bill each month including March has not surpassed $200.00 a month even on the hottest day in July. Since my heat and my stove are both electric, I don’t pay a gas bill. Then there is the phone bill, the internet bill, the television bill, the trash bill, and the water bill. Altogether, these bills (in rounded figures) net roughly between $400.00 and $600.00. If we use $600.00 as our figure, we still have $3,180.00.

Food is a bit tricky. If we were a family of 6 (and for a while in April we were a household of 8), my kids would not have been having breakfast or lunch at school, and I would probably be cooking a lot more than usual. But, since most restaurants have only been take-out and we are unemployed, I have time to cook. But, since cooking is usually cheaper than eating out, I’m saving money. While we were a household of 8 (the oldest grandchild that was staying with us was 13 and with a large yard they played outside and expended a great deal of energy), I spent about $300.00 a week on food. So, let’s subtract $1,200.00. I still have $1,980.00.

Since neither my spouse nor myself drive to a job, we aren’t using much gas, but the auto insurance — no wait, many auto insurance companies gave a discount because we were driving less. Or if your family relied on public transportation to work, that expenditure is now gone.

Now, let’s look at entertainment. No wait, the movie theaters are closed, the restaurants are closed, even the state parks in many areas were closed. We stayed at home and watched television, played video games, played board games, and watched movies.

So, not much of the $1,980.00 needed to be used. Ok, maybe you have vices: you smoke or drink. We don’t so I don’t know how to figure that in.

But wait, in addition to the $1,445.00 a week, we received the one-time payment of $1,200.00 each and $500.00 for each child.

That brings the 20-week total to $33,000.00.

What makes my head spin, however, is wondering what most of these people did with the money.

You couldn’t travel.

You couldn’t go out to eat like you used to.

You didn’t go to the movies.

If you did watch a movie, it might have been on a movie provider at a much lower cost that taking that family of six to the theater or even bought a DVD.

Gyms and membership businesses were forced to shut down, and many suspended the membership fee.

BUT,

most people thought they would return to their jobs before August and didn’t put any of that extra cash into a savings.

Now what?

Now, both businesses that shut down and are now reopening, as well as businesses that stayed open, are finding it difficult to get their employees to return to work. In my town, many businesses have “help wanted” signs in their windows, but even these are having difficulty finding people willing to work.

Why?

As one individual puts it in the article “For Many, $600 Jobless Benefit Makes It Hard to Return to Work” on NPR’s website,

“It’s terrible to say, but we’re all doing better now,” she says. “It’s hard to think about going back to work in this pandemic and getting paid less than we are right now when we’re safe and at home in quarantine.”

Looking Ahead

For the last couple of weeks, politicians have been in a battle: continue the financial support for those affected by the pandemic, increase the amount of support, or diminish the amount of support.

Who’s right?

Who’s wrong?

In my mind, those that want to continue the financial support at the level it was or at a greater level are asking that people become institutionally dependent.

Like so many people and the person quoted above, “Why would I want to go back to my job when I make more staying at home?”

Granted, this is not everyone, and I know that there are many people who used the Pandemic Unemployment Assistance wisely who can’t wait to go back to work.

I am concerned about the institutional dependency that the government assistance seems to be causing and the declining work ethic of many people, but that is for another article.

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Rebecca Writes The articles and comments in Rebecca Writes relate to living in this crazy world. Articles about being a parent and grandparent to traveling to relationships to education to health and wellness to being a decent human being — and beyond.

Rebecca (Becky) spent 34 years in a teaching career, but when she retired in 2014, she picked up her pen and pursued her passion to write. As a high school English teacher, Becky held the philosophy that she wouldn’t give any writing assignment that she personally wouldn’t or couldn’t do. That philosophy strengthened and broadened her own writing.

In addition to publishing her writing on various platforms, Becky also blogs at Life is for Living, a blog to encourage, motivate, and help others live the best life possible. As an extension of Life is for Living, she also publishes a weekly newsletter, Let’s Chat. (Check it out HERE.) Life is for Living also has a social media presence with the group Coffee on my Porch. (Check it out HERE.)

After teaching writing for 34 years, Becky began Ink & Keyboard, a blog for writers at all levels. She supplements what she writes on the blog with a subscription newsletter, The Writer’s Notebook (Check it out HERE.), the social media group Ink & Keyboard (Check it out HERE.), and a Medium publication Ink & Keyboard (Check it out HERE.).

Here are some other articles you might be interested in

Resources

“The extra $600 Americans get in weekly unemployment benefits ends this month — how lawmakers are proposing to replace it.” Market Watch.

“F.A.Q. on Stimulus Checks, Unemployment and the Coronavirus Plan.” New York Times.

“Unemployment Amount Calculation.” Workplace Fairness.

“Collecting Unemployment Benefits in Tennessee.” NOLO

“For Many, $600 Jobless Benefit Makes It Hard To Return To Work.” NPR