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COVID-19 relief should extend CARES Act work-sharing provisions

With over a million new unemployment claims still being filed each week, job growth slowing, and millions of workers about to lose emergency jobless benefits created through the CARES Act in March, it is imperative that Congress enact another COVID-19…

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With over a million new unemployment claims still being filed each week, job growth slowing, and millions of workers about to lose emergency jobless benefits created through the CARES Act in March, it is imperative that Congress enact another COVID-19 emergency relief package as quickly as possible. In addition to key provisions such as aid to state and local governments and extending the emergency benefits for unemployed workers, Congress should also extend innovative provisions that helped prevent workers from being laid off in the first place—specifically the CARES Act’s federal subsidies for work-sharing.

Work-sharing provides a way for many businesses to cope with a drop in consumer demand without having to lay off staff. Under work-sharing, workers’ hours are reduced and they receive partial unemployment insurance (UI) benefits to make up a portion of their lost wages. For example, if a business anticipated having to lay off five workers, they might instead cut in half the hours of 10 staff—achieving the same reduction in total work hours—and those 10 workers would all receive partial unemployment benefits from the state to make up some of their lost income.

By keeping workers on the job, work-sharing mitigates the impact of joblessness and reduces unemployment peaks in downturns. Now that coronavirus vaccines appear to be on the horizon, maintaining a connection between more workers and their employers for the first part of next year makes even more sense. As the pandemic is brought under control and regular consumer demand picks up, companies with work-sharing programs won’t have to go through a process of recruiting, hiring, and training new staff; they will be able to quickly ramp back up simply by restoring participants in work-sharing to full time.

Although work-sharing has not historically been widely used in the United States, Figure A shows that it is fairly common in other parts of the world. In Belgium, the country with the highest take-up rate, work-sharing participants equaled about 5.6% of employment in 2009, a huge cushioning of Belgian families and businesses from the impact of the Great Recession. For comparison, if the U.S. had the same take-up rate of work-sharing as Belgium, roughly 2 million jobs might have been preserved in 2009.i Figure A also shows that in 10 other countries, work sharing equaled 1% to 4% of employment in 2009—five to 20 times larger than usage in the U.S.

Figure A
Figure A

Because of its benefits for businesses and workers, the March CARES Act included a 100% federal subsidy for work-sharing in states that already have work-sharing programs (some 27 states) and a 50% subsidy for states to establish such programs. As a result of these subsidies, when customer demand declined and some businesses needed to operate below full capacity to allow employees to social distance, use of work-sharing picked up after March. In July, U.S. Department of Labor data showed the number of U.S. employers with approved work-sharing programs rose to 14,770, over six times the 2,405 employers who had programs in February. Employee work-share claims spiked in this time as well. As Figure B shows, the number of employee continuing claims filed for work-sharing UI rose from less than 70,000 in February to about 1.7 million in July.

Figure B
Figure B

The use of work-sharing varies by state—but, notably, in a nonpartisan way. Table 1 shows how substantial work-sharing UI is relative to regular UI. (Specifically, the table shows continuing claims for work-sharing UI as a share of all UI continuing claims.) The table is ordered from top to bottom by states’ 2020 shares, starting with Washington’s work-sharing continuing claims equal to almost one-tenth of all UI continuing claims. Of the eight states that have used work-sharing the most to reduce unemployment in 2020, half are “blue” states and half are “red” states. Two of the biggest “red” states—Texas and Florida—also use work-sharing and could capitalize on an extension to use it more.

Also enticing to the politically pragmatic, several states often considered “battleground states” have work-sharing programs but rank in the middle or near the bottom of the list for work-sharing UI claims as a share of all UI claims. Extending the CARES Act subsidy would allow states like Michigan, Ohio, Wisconsin, Minnesota, and Pennsylvania to expand work-sharing and would likely boost their manufacturing sectors, since manufacturers are often the biggest users of work-sharing programs. The incoming Biden administration could also give the Great Lakes states a multi-state peer learning grant to expand work-sharing across the region, including in manufacturing.

Table 1
Table 1

Another reason to extend work-sharing: It’s cheap. It would cost less than $250 million to include work-sharing in the recent bipartisan proposal to extend the CARES Act’s UI provisions.ii

In closing, work-sharing has already made an important contribution to reducing unemployment in the COVID-19 recession. Failing to extend the work-sharing subsidies could sever hundreds of thousands of additional workers from their employers—right when we may be within sight of an end to the pandemic. This would be a form of snatching defeat from the jaws of victory.

(Acknowledgment: the authors gratefully acknowledge the great work of Mary Madsen, first author of Keystone Research Center’s October work-sharing brief and now back at graduate school while working part-time at KRC.)

Steve Herzenberg is the Executive Director of the Keystone Research Center in Harrisburg, Pa. Claire Kovach is a Senior Research Analyst at the Keystone Research Center.

i. Average total nonfarm employment in the U.S. in 2009 was 131.29 millionIf work-sharing as a share of employment rose from 0.2% to 5.6% (Belgium’s rate), that equals 7.09 million. Howeverbecause participants in work-sharing are still partially employed, the resulting increase in employment is not one-to-one increase in the number of jobs. For the first 10 months of 2020, full-time equivalent (FTE) weeks of work-sharing was equal to an average of 27% of all work-sharing claims. Thus, 27% of 7.09 million would be 1.91 million full-time jobs.

ii. The math behind this estimate: In October, there were 198,543 full-time equivalent weeks of UI work-sharing claims, according to the US DOL’s ETA 5159 data on work-sharing. Assuming claims stay at this level—they will more likely decline—and that average unemployment benefits for an FTE week of work-sharing benefits equal $300 (which is the average cost of regular UI benefits); the cost for a 4-month extension of benefits would be $238.2 million.

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Survey Shows Declining Concerns Among Americans About COVID-19

Survey Shows Declining Concerns Among Americans About COVID-19

A new survey reveals that only 20% of Americans view covid-19 as "a major threat"…

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Survey Shows Declining Concerns Among Americans About COVID-19

A new survey reveals that only 20% of Americans view covid-19 as "a major threat" to the health of the US population - a sharp decline from a high of 67% in July 2020.

(SARMDY/Shutterstock)

What's more, the Pew Research Center survey conducted from Feb. 7 to Feb. 11 showed that just 10% of Americans are concerned that they will  catch the disease and require hospitalization.

"This data represents a low ebb of public concern about the virus that reached its height in the summer and fall of 2020, when as many as two-thirds of Americans viewed COVID-19 as a major threat to public health," reads the report, which was published March 7.

According to the survey, half of the participants understand the significance of researchers and healthcare providers in understanding and treating long COVID - however 27% of participants consider this issue less important, while 22% of Americans are unaware of long COVID.

What's more, while Democrats were far more worried than Republicans in the past, that gap has narrowed significantly.

"In the pandemic’s first year, Democrats were routinely about 40 points more likely than Republicans to view the coronavirus as a major threat to the health of the U.S. population. This gap has waned as overall levels of concern have fallen," reads the report.

More via the Epoch Times;

The survey found that three in ten Democrats under 50 have received an updated COVID-19 vaccine, compared with 66 percent of Democrats ages 65 and older.

Moreover, 66 percent of Democrats ages 65 and older have received the updated COVID-19 vaccine, while only 24 percent of Republicans ages 65 and older have done so.

“This 42-point partisan gap is much wider now than at other points since the start of the outbreak. For instance, in August 2021, 93 percent of older Democrats and 78 percent of older Republicans said they had received all the shots needed to be fully vaccinated (a 15-point gap),” it noted.

COVID-19 No Longer an Emergency

The U.S. Centers for Disease Control and Prevention (CDC) recently issued its updated recommendations for the virus, which no longer require people to stay home for five days after testing positive for COVID-19.

The updated guidance recommends that people who contracted a respiratory virus stay home, and they can resume normal activities when their symptoms improve overall and their fever subsides for 24 hours without medication.

“We still must use the commonsense solutions we know work to protect ourselves and others from serious illness from respiratory viruses, this includes vaccination, treatment, and staying home when we get sick,” CDC director Dr. Mandy Cohen said in a statement.

The CDC said that while the virus remains a threat, it is now less likely to cause severe illness because of widespread immunity and improved tools to prevent and treat the disease.

Importantly, states and countries that have already adjusted recommended isolation times have not seen increased hospitalizations or deaths related to COVID-19,” it stated.

The federal government suspended its free at-home COVID-19 test program on March 8, according to a website set up by the government, following a decrease in COVID-19-related hospitalizations.

According to the CDC, hospitalization rates for COVID-19 and influenza diseases remain “elevated” but are decreasing in some parts of the United States.

Tyler Durden Sun, 03/10/2024 - 22:45

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Rand Paul Teases Senate GOP Leader Run – Musk Says “I Would Support”

Rand Paul Teases Senate GOP Leader Run – Musk Says "I Would Support"

Republican Kentucky Senator Rand Paul on Friday hinted that he may jump…

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Rand Paul Teases Senate GOP Leader Run - Musk Says "I Would Support"

Republican Kentucky Senator Rand Paul on Friday hinted that he may jump into the race to become the next Senate GOP leader, and Elon Musk was quick to support the idea. Republicans must find a successor for periodically malfunctioning Mitch McConnell, who recently announced he'll step down in November, though intending to keep his Senate seat until his term ends in January 2027, when he'd be within weeks of turning 86. 

So far, the announced field consists of two quintessential establishment types: John Cornyn of Texas and John Thune of South Dakota. While John Barrasso's name had been thrown around as one of "The Three Johns" considered top contenders, the Wyoming senator on Tuesday said he'll instead seek the number two slot as party whip. 

Paul used X to tease his potential bid for the position which -- if the GOP takes back the upper chamber in November -- could graduate from Minority Leader to Majority Leader. He started by telling his 5.1 million followers he'd had lots of people asking him about his interest in running...

...then followed up with a poll in which he predictably annihilated Cornyn and Thune, taking a 96% share as of Friday night, with the other two below 2% each. 

Elon Musk was quick to back the idea of Paul as GOP leader, while daring Cornyn and Thune to follow Paul's lead by throwing their names out for consideration by the Twitter-verse X-verse. 

Paul has been a stalwart opponent of security-state mass surveillance, foreign interventionism -- to include shoveling billions of dollars into the proxy war in Ukraine -- and out-of-control spending in general. He demonstrated the latter passion on the Senate floor this week as he ridiculed the latest kick-the-can spending package:   

In February, Paul used Senate rules to force his colleagues into a grueling Super Bowl weekend of votes, as he worked to derail a $95 billion foreign aid bill. "I think we should stay here as long as it takes,” said Paul. “If it takes a week or a month, I’ll force them to stay here to discuss why they think the border of Ukraine is more important than the US border.”

Don't expect a Majority Leader Paul to ditch the filibuster -- he's been a hardy user of the legislative delay tactic. In 2013, he spoke for 13 hours to fight the nomination of John Brennan as CIA director. In 2015, he orated for 10-and-a-half-hours to oppose extension of the Patriot Act

Rand Paul amid his 10 1/2 hour filibuster in 2015

Among the general public, Paul is probably best known as Capitol Hill's chief tormentor of Dr. Anthony Fauci, who was director of the National Institute of Allergy and Infectious Disease during the Covid-19 pandemic. Paul says the evidence indicates the virus emerged from China's Wuhan Institute of Virology. He's accused Fauci and other members of the US government public health apparatus of evading questions about their funding of the Chinese lab's "gain of function" research, which takes natural viruses and morphs them into something more dangerous. Paul has pointedly said that Fauci committed perjury in congressional hearings and that he belongs in jail "without question."   

Musk is neither the only nor the first noteworthy figure to back Paul for party leader. Just hours after McConnell announced his upcoming step-down from leadership, independent 2024 presidential candidate Robert F. Kennedy, Jr voiced his support: 

In a testament to the extent to which the establishment recoils at the libertarian-minded Paul, mainstream media outlets -- which have been quick to report on other developments in the majority leader race -- pretended not to notice that Paul had signaled his interest in the job. More than 24 hours after Paul's test-the-waters tweet-fest began, not a single major outlet had brought it to the attention of their audience. 

That may be his strongest endorsement yet. 

Tyler Durden Sun, 03/10/2024 - 20:25

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The Great Replacement Loophole: Illegal Immigrants Score 5-Year Work Benefit While “Waiting” For Deporation, Asylum

The Great Replacement Loophole: Illegal Immigrants Score 5-Year Work Benefit While "Waiting" For Deporation, Asylum

Over the past several…

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The Great Replacement Loophole: Illegal Immigrants Score 5-Year Work Benefit While "Waiting" For Deporation, Asylum

Over the past several months we've pointed out that there has  been zero job creation for native-born workers since the summer of 2018...

... and that since Joe Biden was sworn into office, most of the post-pandemic job gains the administration continuously brags about have gone foreign-born (read immigrants, mostly illegal ones) workers.

And while the left might find this data almost as verboten as FBI crime statistics - as it directly supports the so-called "great replacement theory" we're not supposed to discuss - it also coincides with record numbers of illegal crossings into the United States under Biden.

In short, the Biden administration opened the floodgates, 10 million illegal immigrants poured into the country, and most of the post-pandemic "jobs recovery" went to foreign-born workers, of which illegal immigrants represent the largest chunk.

Asylum seekers from Venezuela await work permits on June 28, 2023 (via the Chicago Tribune)

'But Tyler, illegal immigrants can't possibly work in the United States whilst awaiting their asylum hearings,' one might hear from the peanut gallery. On the contrary: ever since Biden reversed a key aspect of Trump's labor policies, all illegal immigrants - even those awaiting deportation proceedings - have been given carte blanche to work while awaiting said proceedings for up to five years...

... something which even Elon Musk was shocked to learn.

Which leads us to another question: recall that the primary concern for the Biden admin for much of 2022 and 2023 was soaring prices, i.e., relentless inflation in general, and rising wages in particular, which in turn prompted even Goldman to admit two years ago that the diabolical wage-price spiral had been unleashed in the US (diabolical, because nothing absent a major economic shock, read recession or depression, can short-circuit it once it is in place).

Well, there is one other thing that can break the wage-price spiral loop: a flood of ultra-cheap illegal immigrant workers. But don't take our word for it: here is Fed Chair Jerome Powell himself during his February 60 Minutes interview:

PELLEY: Why was immigration important?

POWELL: Because, you know, immigrants come in, and they tend to work at a rate that is at or above that for non-immigrants. Immigrants who come to the country tend to be in the workforce at a slightly higher level than native Americans do. But that's largely because of the age difference. They tend to skew younger.

PELLEY: Why is immigration so important to the economy?

POWELL: Well, first of all, immigration policy is not the Fed's job. The immigration policy of the United States is really important and really much under discussion right now, and that's none of our business. We don't set immigration policy. We don't comment on it.

I will say, over time, though, the U.S. economy has benefited from immigration. And, frankly, just in the last, year a big part of the story of the labor market coming back into better balance is immigration returning to levels that were more typical of the pre-pandemic era.

PELLEY: The country needed the workers.

POWELL: It did. And so, that's what's been happening.

Translation: Immigrants work hard, and Americans are lazy. But much more importantly, since illegal immigrants will work for any pay, and since Biden's Department of Homeland Security, via its Citizenship and Immigration Services Agency, has made it so illegal immigrants can work in the US perfectly legally for up to 5 years (if not more), one can argue that the flood of illegals through the southern border has been the primary reason why inflation - or rather mostly wage inflation, that all too critical component of the wage-price spiral  - has moderated in in the past year, when the US labor market suddenly found itself flooded with millions of perfectly eligible workers, who just also happen to be illegal immigrants and thus have zero wage bargaining options.

None of this is to suggest that the relentless flood of immigrants into the US is not also driven by voting and census concerns - something Elon Musk has been pounding the table on in recent weeks, and has gone so far to call it "the biggest corruption of American democracy in the 21st century", but in retrospect, one can also argue that the only modest success the Biden admin has had in the past year - namely bringing inflation down from a torrid 9% annual rate to "only" 3% - has also been due to the millions of illegals he's imported into the country.

We would be remiss if we didn't also note that this so often carries catastrophic short-term consequences for the social fabric of the country (the Laken Riley fiasco being only the latest example), not to mention the far more dire long-term consequences for the future of the US - chief among them the trillions of dollars in debt the US will need to incur to pay for all those new illegal immigrants Democrat voters and low-paid workers. This is on top of the labor revolution that will kick in once AI leads to mass layoffs among high-paying, white-collar jobs, after which all those newly laid off native-born workers hoping to trade down to lower paying (if available) jobs will discover that hardened criminals from Honduras or Guatemala have already taken them, all thanks to Joe Biden.

Tyler Durden Sun, 03/10/2024 - 19:15

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