Double Trouble for Service Workers:  No Jobs and Little Unemployment

Ideas and Issues

 Pearl River     There was a peculiar piece in the Wall Street Journal that left me scratching my head and then trying to remember, somewhat successfully, high school algebra.  The article talked about the gap between service workers and professionals getting to work at home and often keeping their jobs.  Ok, sure, but what had caught my eye were two graphics that accompanied the article, but were never mentioned in the story by Ben Eisen at all, which was too weird, especially since several were hammer blows to the head and heart.

The graphic illustrated the results of Barnard College Professor Elizabeth Ananat’s survey of 1000 service workers in the Philadelphia-area.   Her findings powerfully underline the pandemic and economic disaster with some frightening twists.  She found that of the 1000 workers, 40% were laid off.  That’s 400 workers.  Of those 400, 87% applied for unemployment, that 348 of the workers.  Of those 348, only 65% actually received benefits.  That’s 226 workers, and that’s a scandal.  On those 226 workers, only 77% or 174 workers actually received the $600 special stimulus money, and that’s another outrage.  Let’s review.  Of the 40% of service workers laid off, less than half, just 44% of those jobless workers actually got the unemployment benefits with the stimulus.

Remember please that unemployment is based on insurance that workers and their employers are paying.  It’s not a giveaway.  That more than 1 out 3 workers applying for unemployment are blocked from receiving their benefits, underlines how the state-administered programs are robbing huge numbers of eligible workers of their entitled benefits.  Once qualified, the fact that a too inept federal government, once again trying to push money to the jobless through too frequently incompetent, tight-fisted, and out-of-date state unemployment systems, picked the pockets of another almost 1 out of 4 of the workers actually receiving benefits.

If it’s not enough to contemplate the horror of government bureaucracies at war with their workers even in an economic disaster, for the sake of argument, and since there are no better figures out there, let’s extrapolate Professor Ananat’s numbers, as if they applied uniformly throughout the rest of America’s service sector.  We know from Bureau of Labor Statistics that 30 million workers were getting unemployment benefits at the end of July 2020.  On the success rate of applicant to recipient she had found, that would mean more than 46 million service workers had applied for unemployment with 30 million making it through the system.  Of those 30 million at the same 77% ratio, 23.1 million might have accessed the extra $600 in supplemental benefits.

Incredible, and it gets worse!  At the same ratios, that means 52.5 million service workers were laid off with 46 million plus actually applying for the benefits that they had earned and paid for.  Of 108 million service workers as of July 2019, that would be way too close to half of all service sector workers finding themselves unemployed during the pandemic with only 44% or 23.1 million getting the full benefits of the stimulus payments.

The other unexamined, but invaluable, graphics with the article were as telling.  One showed the soaring level of hunger and food insecurity now, but given the figures just discussed, who could be surprised.  The other detailed the surge of spending that had accompanied the receipt of stimulus money based on workers who had received the benefits and had Chase bank accounts.  In another cruel irony, it is clear to me that if all the unemployed had received benefits and the stimulus money, consumer spending and much of the economy would be roaring right now, rather than slow walking through the depression.

Why unemployed workers are not breaking down the doors of unemployment offices in the states and pounding on the office walls of their federal and state elected officials to fix these scandals that have hijacked their money and benefits is a mystery to me, but only highlights the strength and pervasiveness of American and corporate ideology that continues to rob American workers blind.