Hi everyone, this is Dr. Nitin Chhoda! In this video I'm going to talk to you
about the BIG problem with the $600 per week federal unemployment booster that
essentially is a lifeline for many individuals and the shocking
discrepancies that exist nationwide. I'm going to go over THREE things in this
video. The first is some important research from a major nonprofit group
based out of Washington DC. Number 2, I'm going to talk to you about the
surprising discrepancies that exist nationwide with the $600 week booster
and then I'll talk to you about what you should be aware of and how you can plan
ahead. The American Action Forum (AAF) publishes research on economic domestic
and fiscal meaning financial policy issues. They have a bunch of economists, a
bunch of experts on their panel that do the research and write articles. What
they also do is according to their website they promote innovative free
market solutions to build a stronger more prosperous future and keep in mind
this is an independent non-political, nonprofit agency located in Washington
DC. Now I read a fascinating article on their website from Isabel Soto who's a
labor market policy data analyst. Now the AAF did state on their website that the
research and analysis published by their staff and experts reflects the views of
the author and does not necessarily reflect the views of the AAF. So according
to this article on their website the $600 per week federal booster which
again is a lifeline for millions of Americans which is scheduled to end on
the 31st of July is indeed creating a disincentive for individuals making them
not want to go back to work. Now senator Rob Portman from Ohio did introduce a
back to work bonus proposal and I have covered that in another training video
on my channel so you definitely want to check that out and this article said
that nationally 63% of individuals currently make more on
unemployment than they did if they were working. In fact if this federal
supplement, the federal booster was reduced to just $100 a
week so that's a big drop from $600 all the way down to $100 even then 25%
of the US population would still make more 25% of the
workforce would still make more on unemployment than they did while they
were working. The article also said due to variations between states (because
keep in mind the unemployment benefits vary from one state to another) changing
the amount of the federal supplement or the federal booster will affect the
incentives for some workers and not others. So essentially a uniform federal
policy may not be the best way to go about it because different states pay
different amounts in unemployment. Different states have different criteria
because at the end of the day your unemployment benefits your UI is
dependent on the interpretation of your state agency. So if you have any
questions you need to get in touch with your state agency. Now I want my
subscribers to understand that when decisions are made by the administration,
when decisions are made in the House, when decisions are made in the Senate
they are done by trying to take into consideration the needs of the vast
majority even when a policy expert writes an article like this what they're
trying to do is create a solution that is ideal for the vast majority of the
population there is a gray area that exists because human lives are at stake
what happens to individuals who lost their job individuals whose hours were
cut individuals who now have to come back at a lower salary individuals who
have been furloughed there are a lot of gray areas at work here and this is a
very complex subject and I have addressed this in other videos on my
channel so you definitely want to check out the unemployment benefits crash
course but for now let's take a look at this table on your screen which is the
percentage of US workers that receive more on maximum unemployment at
different federal benefit levels keep in mind the current benefit level the
current $600 per week federal booster at the time I'm recording this video is six
hundred dollars a week now this table was created by taking into consideration
the maximum benefit in each state as well as a 2009 wage data now when you
look at this table all the way to one side you see that 63% of individuals who
receive the unemployment benefits including the $600 per week federal
booster would make more money on unemployment than they would at their
regular job now let's assume that that federal booster after the 31st of July
was reduced to $500 a week in other words it's not going to be at 600 by the
way that's pretty like because the Republicans want to do away
with the federal booster but the Democrats want the $600 federal booster
to continue and I think there'll be some sort of a compromise but I do believe
that there will be some sort of a booster after the 31st of July I
personally feel very confident about that but again that's just my opinion as
a concerned citizen on a YouTube channel I'm not a policy expert and I'm
definitely not I'm definitely not in Congress or the Senate if this federal
booster went back down to $500 then still 58 percent of individuals would
still make more on unemployment if this federal booster went down to $400 a week
by the way that's a significant drop from $600 a week to $400 a week that's a
50% drop in the federal booster even then more than half the individuals
getting unemployment benefits would still make more money on unemployment as
compared to if they were having their regular jobs now if this booster was cut
in half if it was reduced to $300 that would mean that 45% of individuals would
still make more money on unemployment and if it was cut down to all the way
down to just $100 a week one in every four individuals would still make more
money on unemployment than the federal boost now think about this let's say you
go to a restaurant and you have individuals working in the restaurant on
minimum wage you go to a movie theater at some point in the future that are
individuals working in the movie theater at or close to minimum wage these are
the individuals a low wage earners that are going to be making more on
unemployment and I believe they should I mean they should make more money on
unemployment because they need the money it's not if if I'm a minimum wage worker
it's not my fault that I'm a minimum wage worker I'm I'm depending on the
wages that I earn I should be getting help on unemployment and I do believe
that the way our system exists which is a one-size-fits-all approach is not an
ideal system I think individuals who need help the most should get that help
now there's a significant difference in the weekly unemployment benefits payouts
between different states some states pay more other states pay less in if you're
in New York for example you get a higher weekly benefit amount then let's
you an Alabama on top of that individuals have different standards of
living again if you live in New York regardless of your weekly unemployment
benefits your cost of living is higher your rent is higher your cost of food is
higher than if you live somewhere in Alabama for instance so because of all
of these complexities across different states because of the difference in the
standard of living because of the difference in the state's interpretation
of who qualifies for an employment and who doesn't qualify for an employment
there are a lot of gray areas and this is an extremely complex subject
I've actually covered this in several training videos and you can check out
the unemployment benefits playlist the unemployment benefits crash course on my
channel I recommend you go through all the videos in that crash course to get a
complete picture a complete idea of your unemployment benefits now on top of this
Democrats want to extend unemployment Republicans want to put an end to
unemployment benefits a $600 per week federal boosters specifically and they
want individuals to get back to work as if this wasn't enough some states have
started to reinstate job search requirements which by the way were
relaxed during this pandemic but some states are saying hey you need to go out
there and look for a job and then if you don't find a job you're going to
continue to qualify for unemployment so you need to talk to your state agencies
to make sure that you continuously qualify for unemployment and you
continuously meet the criteria in order to continue to receive unemployment
benefits also Georgia is working on a different strategy which is allowing
workers to keep benefits while working this is fascinating we need some sort of
a creative some sort of a blended approach that allows individuals to
continue getting the support that they need while also being motivated to go
out there and find a job when it is safe for them and when the jobs are available
those are the two critical factors that really need to be addressed and I don't
see enough people talking about that and finally just to prove the point of the
significant variation between states you see a chart on your screen
that highlights the percentage of workers in each states that receive more
on maximum unemployment benefits at different federal benefit levels because
I foresee the federal benefit level the $600 week federal booster changing
the 31st of July now regardless of whether it changes or not this chart in
this article will give you an idea of the variation between different states
let's take a look at California for example in the state of California if
the federal booster remains at six hundred dollars 55 percent of
individuals in the state of California will make more money if they remain on
unemployment and if the benefits were were reduced all the way down to just an
additional $100 instead of an extra $600 you see that the number of individuals
in California who make more on unemployment drops to 20 percent so
that's from 55 percent all the way down to 20 percent that means anywhere from
half of the population to one in every five individuals would end up making
more money on unemployment which is the basis of the argument that it creates a
disincentive to work now let's take a look at New York and then we look at New
Jersey in New York the numbers suggest 60 percent of individuals would make
more on unemployment if they got the $600 a week federal booster and that
number drops down to 25 percent still that's one in every four individuals
with a minimal federal booster of $100 a week now New Jersey is surprising in New
Jersey as much as 65 percent of individuals would make more on
unemployment and if the federal booster went down to $100 as much as forty five
percent almost half the individuals almost half of those receiving
unemployment benefits in New Jersey would still make more money on
unemployment of the federal booster went down to just a hundred dollars a week on
top of state unemployment benefits so this gives you a sense of how
fundamentally inconsistent how fundamentally unfair the federal booster
is because it disproportionately helps some individuals and it
disproportionately hurts other individuals it's more than enough for
some individuals and it's simply not enough for the individuals now if you
thought the numbers in New Jersey were unusual take a look at the numbers in
Pennsylvania and Pennsylvania seventy percent of individuals would make more
money on unemployment with the $600 week federal booster in other words if the
600 or weak federal booster continues as much as 70 percent of individuals
according to the lickin's would not have an incentive to
go back to work what happens when this federal boosters cut back down to just
$100 a week which again there's going to be some variation of that happening
after the 31st of July in Pennsylvania 40% of individuals would still make more
money on unemployment the numbers also pretty significant in Texas 70% of
individuals in the state of Texas would make more money on unemployment with the
federal boosts and if that booster was dropped down to $100 35% of individuals
would make more money on unemployment now let's take a look at Florida and
Georgia which tend to have similar numbers 60% of individuals in both
Florida and Georgia would make more money on unemployment I should say are
making more money on unemployment with the $600 week federal booster if that
federal booster went all the way down to less than $100 a week less than 10% of
individuals in Florida would make more on unemployment which would in effect
create an incentive to go back to work and 20% of individuals in Georgia would
make more money on unemployment so as you can see there's a significant
variation between states I covered a few states if you want to see some of those
numbers specific to your state definitely check out the link to the
original article in the description below but here's the bottom line
fundamentally the $600 a week federal booster had good intentions it has
helped millions of people but it should not end after the 31st of July that's
number one number two it is fundamentally unfair to some individuals
because what happens to individuals who finally started to get unemployment in
July they'd only get the booster for a few weeks and what they're out of luck
after that this shouldn't be a first-come first-served kind of approach
this should benefit all of us consistently and uniformly and those are
just two of the factors there are a lot of other factors at play here and
hopefully the house is listening the Senate is listening and hopefully
there'll be some sort of a result that benefits most of us I don't think the
administration will be able to do something that helps each and every one
of us because this is such a massive job but hopefully they can come up with a
solution that is consistent with what we expect as United States citizens
whatever happens I encourage you to use this time wisely
learn new skills become more literate financially I've talked about financial
literacy on my channel I have a managing your money playlist that I definitely
encourage you to check out watch those videos so you improve your financial
literacy learn new skills improve your financial literacy and also please save
as much money as you can because this should teach us a lesson and that lesson
is it's always a good idea to have some amount of savings so you can get through
a crisis like this thank you so much for watching I hope you learned something
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