by Mitch Kokai
Senior Political Analyst, John Locke Foundation
It has been almost two years since the economy recovered fully from the coronavirus pandemic, but more than 3 million workers are still missing from the workforce. University of Chicago economics professor Casey Mulligan and Heritage Foundation Research Fellow EJ Antoni believe they know why: State and federal governments are paying people not to work.
In a new study titled “Paying Americans Not to Work,” Mulligan and Antoni added up how much cash and benefits a family of four with both parents not working receives in every state. They then compared those numbers to both the national median household income with benefits as well as the median salary and benefits of selected professions.
In five states, a family of four with two parents not working can make more in unemployment benefits and Obamacare subsidies than the national median household income with benefits. In a dozen states, the value of unemployment benefits and Obamacare subsidies exceeds the average salary and benefits of electricians, firefighters, teachers, and truck drivers.
Unemployment benefits last a maximum of only six months, but it only requires a work history of another six months to qualify for unemployment benefits again. So one can work half the year and take the other half off without any loss of income. Moreover, the study only looked at unemployment benefits and Obamacare subsidies. It did not add in other benefits such as food stamps, which have weak work requirements in most states, or Section 8 housing subsidies. Throw these programs into the mix, and the payout for not working rises still higher.
When our government pays people who could work but chose not to more in cash and benefits than an average worker, it betrays everyone who does work. It is also bad for the recipients of the benefits and for the communities they live in.