From Investor’s Business Daily Eric Singer writes If Economy’s Improving, Why Is Dependency Growing?
Excerpts:
How can we have falling unemployment and falling labor force participation at the same time? I heard a story a while ago about a woman who had been making $50,000 per year who was laid off.
After some months of casually searching for a full time job, she was offered one paying $40,000, but she refused it.
Her logic was, I am getting $20,000 per year from unemployment benefits, and I am collecting $18,000 per year from baby-sitting off-the-books three days a week, which, after accounting for my lower taxes, works out to almost the same for less work.
Why should she work harder than necessary to pursue happiness? When 67.3 million other Americans are taking easy money from the government, why should she stand on ceremony? Where is the shame? Where is the stigma? Is she “too discouraged” or just selfish? My fear is that many people will look at her experience and say, how can I work only three days a week and collect the same money?
But the corruption of the workforce is utterly corrosive to America in the long term. We are supposed to be the “land of the free, and the home of the brave.”
HKO comments:
The story may be anecdotal and every side has a spin to the data, but the point of the corruptive effect on the workforce is sound. 99 weeks of unemployment is too long and destroys the work ethic. Our incentives are against hiring for the employers and against working for the employees. There are further great incentives that make it increasingly difficult to start a new business. The fact that the unemployment is not much higher speaks well for the fact that the work ethic remains intact.
Many workers have faults of habit and character that will always impede them in the workplace, but others may also fall susceptible to the temptation to game the system. When government programs make this available over time it becomes a social norm. Such norms became common in Europe. There is a difference between self reliance and only looking out for number one, especially when this must come at the expense of some one else.
PS 9/2/12
In a recent business meeting several employers who hire labor for such positions as roofers, warehouse workers and construction positions; all paying over ten dollars an hour and most with some long term benefits all agreed that it was much harder to hire for those positions today than it was five years ago when the unemployment rate was much lower. One of my employees recently asked to get a CUT in pay in order to remain qualified for Peach Care, the Georgia State assistance for children’s health care costs. Something here is very wrong.
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