As with most anything in life, it seems no matter what the case, unintended, and unexpected consequences happen. That is what is happening now as a byproduct of the stimulus package that the government provided to Americans to help them better manage the recent pandemic's financial problems.
What was intended as a one time helping hand, had resulted in many workers asking employers to lay them off or simply refusing to go back to work when recalled from their furlough. They had found that they can live better furloughed than when they were working.
The passing and enacting of the CARES (Coronavirus Aid, Relief, and Economic Security) act, those who draw unemployment received an additional $600 a week on top of their current benefits. Again, this is in addition to what the states they live in was already paying them—which averaged $200 to $300 a week.
When all added up, depending on what state the individual resided in, this would be earnings of up to $1000 a week while on unemployment. In addition to these earnings, most Americans who filed 2018/2019 tax returns and earning less than $75,000 also received a one-time stimulus check for $1200 for each adult and up to $500 for each child under the age of 17 in the household.
Here is where the rubber meets the road in the situation. Take into consideration a person who works on their feet all day at a physically demanding job, earning a wage of $15 per hour. That calculates out pre-tax deductions to $525 per week. However, there are those who are sitting at home, not working for their living, and are receiving more each week than those that work.
One can see why an individual would request to be laid off or refuse to return from being furloughed. Who wants to work a physically demanding job or any job for that matter will have them earn less than they would on current benefits from unemployment. They could ride out the pandemic, from the safety of their home, collect their pay through unemployment, and then look into returning to the job market when it appears things are looking safer.
Although this may be the ideal scenario in the eyes of most workers, for businesses, it would be a logistical nightmare at the least. Companies all across the country have their furloughed employees, whom they call back to work, telling them they don't want to. They have it much better as it is, and honestly, who can blame them.
Did the stimulus checks hurt rather than help the economy in the long run?