I was living in Manhattan Beach, Calif, during the time that President Obama extended the unemployment benefits.
There were surfers in the water from dawn to dusk.
The very week that the unemployment benefits stopped, the beaches were empty, except for dawn surfers and dusk surfers.
Incentives matter.
An unintended and unexpected consequence of the multitrillion dollar stimulus package is that workers are asking to be laid off or reluctant to go back to work after being furloughed.
I disagree that this is “unexpected.” It’s not unexpected by economists, who understand that incentives matter.
In an effort to help people financially cope with their job losses in the midst of a pandemic, the federal government—through the Coronavirus Aid, Relief and Economic Security Act (CARES Act)—is providing an extra $600 per week in unemployment benefits. This amount is in addition to what the states already pay, which is in the range of $200 to $300 per week.
A person could conceivably earn $1,000 per week on unemployment, depending upon the state he or she resides in. In addition to the enhanced benefits, most Americans, earning less than $75,000 in 2019, received a one-time check for $1,200 and $500 for each child under 17 years of age.