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Extending unemployment insurance to striking workers would cost little and encourage fair negotiations

Unions and collective action have long served as a vehicle for ensuring prosperity for working families and creating a more equal economy.

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Unions and collective action have long served as a vehicle for ensuring prosperity for working families and creating a more equal economy. Despite these critical functions, workers engaged in collective action, like strikes, have historically been barred from accessing safety net programs like unemployment insurance (UI). In a welcome development, state lawmakers are beginning to rethink this convention, recognizing the dual roles of UI in stabilizing the economy and unions in securing broad-based economic growth.

A growing number of states are proposing legislation to extend unemployment insurance to striking workers

In just the past two years, lawmakers in nine states have introduced legislation aimed at granting or enhancing striking workers’ access to UI. As shown in Table 1, New York and New Jersey are currently the only two states where striking workers can apply for UI benefits following a 14-day waiting period. This month, New York legislators proposed a further reduction to seven days.  

However, not all legislative efforts have been successful. The Connecticut Senate rejected a bill that would have permitted striking workers to access UI after 14 days, while California Governor Gavin Newsom vetoed a similar bill that passed in the state legislature. Presently, Massachusetts and Pennsylvania legislators are considering laws with 30-day waiting periods, Illinois and Ohio are considering bills with 14-day waiting periods, and Washington is considering a bill with a seven-day waiting period.

Table 1

Collective action—such as going on strike—is one of the most effective means to counter the inherent power imbalance between workers and employers. But the decision to strike is fraught with risk. U.S. labor law offers limited protections to striking workers and excludes many occupations from the right to strike at all. When workers do strike, their paychecks stop and employers can cut benefits—including health coverage for their entire families. In some cases, striking workers can be permanently replaced and lose their job altogether. As such, the decision to walk off the job is typically a measure of last resort, exercised only after workers have exhausted all other avenues of negotiation.

Extending UI to striking workers is good economics and consistent with the program’s goals

The U.S. unemployment insurance system was established following the Great Depression, amid a period of widespread joblessness. It is intended to offer a financial lifeline to jobless workers, supporting them through times of economic turmoil, or until they find work that provides adequate pay and aligns with their skills and circumstances. In this way, a strong UI system provides workers enough cushion to navigate hardships and find the right job, not just the first job available.

UI is also a critical support for macroeconomic health. UI dollars help keep local economies running during periods of widespread unemployment and economic turmoil. And by allowing workers to find the jobs best suited for their skills, it helps maximize the long-run productivity of the workforce.

Making striking workers eligible for UI is, therefore, both good economics and consistent with the program’s mandate. It would mitigate some of the immediate economic risk to workers and their families, keep dollars flowing to communities where a strike is taking place, and ensure striking workers can negotiate a fair contract with their employer.

Some might be concerned that workers would be more inclined to strike if they could rely on unemployment insurance. This fear is unfounded. First, there is no U.S. state where workers can afford basic necessities with current UI benefit levels (a fact that speaks to the need for long-overdue reforms to the UI system). But even with a more robust unemployment insurance system, allowing striking workers to collect benefits might actually lead to fewer strikes. If employers knew that workers could collect UI when involved in prolonged labor disputes, it would incentivize more earnest negotiations. It would help prevent scenarios where employers use their typically much larger economic resources to outlast workers while either refusing to bargain in good faith or presenting a “final offer” they know workers are likely to reject, a strategy that currently undermines the effectiveness of collective bargaining. Making UI available to striking workers is one step lawmakers can take to help level the playing field and ensure a fairer negotiation process.

Extending UI to striking workers would provide meaningful benefits with little-to-no impact on state UI systems

In several states, proposals to extend unemployment insurance to striking workers have faced opposition, primarily over concerns about the potential financial burden on state UI funds. However, analysis of strike and UI claims data shows there is no basis for such concerns. Table 2 compares strike participants with UI claimants from January 2022 to November 2023. In a typical month, the average number of striking workers eligible for UI under proposed legislation is significantly lower than the number of workers who file UI claims caused by typical turnover in the labor market. When comparing with the average monthly ongoing UI claims—a more reliable measure of approved and paid claims—striking workers would comprise only between 0% and 1.2% of all monthly claims in each state.

But even this is an overestimate, because not everyone eligible for UI applies for benefits. Historically, unemployment insurance has been underutilized, and this problem has only worsened in recent years. One study on disparities in UI recipiency revealed that union members and individuals in states with historically higher recipiency rates tended to be better informed about UI eligibility, and thus were more likely to apply if they lost their job. Yet despite the tendency to be better informed, only 55% of unemployed union members who were eligible for UI actually filed for benefits compared with 38% of non-union members. Thus, it would be wrong to assume that all eligible striking workers would utilize UI. 

Table 2
Table 2

Further, lawmakers should consider shortening the waiting periods required for striking workers to access UI. Figure A shows that the vast majority of strikes are short-lived, with 86% of strikes ending within 14 days and 92% ending within 30 days, according to data from the Cornell ILR School. This timeframe is critical because it often falls before the eligibility waiting period for UI benefits in many proposed state bills. This trend suggests the likelihood of striking workers meeting the criteria to file for UI is relatively low, especially in states with lengthy waiting periods. And while fewer workers accessing UI means smaller costs to state and employer UI funds, it also means many workers and their families might not be able to access this valuable lifeline when they need it most.

Figure A
Figure A

Table 3 presents a detailed cost analysis of proposed legislative changes for striking workers’ access to unemployment insurance, finding that the financial impact of extending UI to striking workers is negligible in the broader context of state UI expenditures. I consider four scenarios, each based on different assumptions.

First, to estimate the weekly cost of UI for striking workers, I calculate the product of the number of potentially eligible striking workers in each state, the typical state UI recipiency rate, and the average weekly UI benefit. Then, I factor in the average duration of strikes that meet or exceed the proposed eligibility waiting period, assuming this represents the average strike length.

Next, based on research suggesting union members are more likely to apply for UI, I hypothesize a 20-percentage-point higher application rate among unionized workers compared with their non-union counterparts. I then estimate an unlikely scenario where 100% of eligible striking workers apply for and receive UI benefits.

Finally, I consider a scenario where 100% of eligible striking workers apply for UI and strikes last an additional four weeks beyond the average. In each scenario, the projected monthly UI payments to striking workers are minuscule compared with the average monthly benefits paid to workers across each state.

Table 3
Table 3

State lawmakers can bolster collective action by extending UI to striking workers

In the past few years, the importance of collective bargaining has commanded the national spotlight as workers seek to improve working conditions and reverse decades of stagnating wages and growing income inequality. After threatening a nationwide strike, UPS workers secured heat safety measures like air conditioning in delivery vehicles, additional paid holidays, limitations on workplace surveillance, and more. In October 2023, United Auto Workers (UAW) ended their 46-day strike after securing 25% wage increases, improved benefits, union coverage expanded to non-union EV plants, and the right to strike over plant closures. During the initial waves of COVID-19, workers in various industries—from meat processing plants (Georgia, Nebraska, North Carolina) to retail giants like Amazon—used strikes to secure hazard pay and improved safety measures.

With the role of unions in promoting workers’ rights and economic equality becoming increasingly salient, it is no surprise to see growing numbers of union election petitions and a renewed surge in strike activity. However, under existing weak and outdated labor laws, workers attempting to unionize or negotiate a fair contract still face significant power imbalances and obstacles. Expanding unemployment insurance to striking workers can help rebalance this equation. In fact, a 2020 survey revealed that workers who had high confidence in their ability to access UI felt more empowered to join or form unions and were less fearful to engage in collective action to address health and safety concerns.

Thus, expanding UI to striking workers could provide them with the critical leverage they need to improve their working conditions. Lawmakers should seize this opportunity to encourage fairer negotiations between employers and employees, while ensuring workers can act collectively when needed.

The author thanks Johnnie Kallas and the Cornell ILR School for sharing data that comprise the Labor Action Tracker.

Appendix Table A
Appendix Table A
Appendix Table B
Appendix Table B

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International

United Airlines adds new flights to faraway destinations

The airline said that it has been working hard to "find hidden gem destinations."

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March 8, 2024

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Since countries started opening up after the pandemic in 2021 and 2022, airlines have been seeing demand soar not just for major global cities and popular routes but also for farther-away destinations.

Numerous reports, including a recent TripAdvisor survey of trending destinations, showed that there has been a rise in U.S. traveler interest in Asian countries such as Japan, South Korea and Vietnam as well as growing tourism traction in off-the-beaten-path European countries such as Slovenia, Estonia and Montenegro.

Related: 'No more flying for you': Travel agency sounds alarm over risk of 'carbon passports'

As a result, airlines have been looking at their networks to include more faraway destinations as well as smaller cities that are growing increasingly popular with tourists and may not be served by their competitors.

The Philippines has been popular among tourists in recent years.

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United brings back more routes, says it is committed to 'finding hidden gems'

This week, United Airlines  (UAL)  announced that it will be launching a new route from Newark Liberty International Airport (EWR) to Morocco's Marrakesh. While it is only the country's fourth-largest city, Marrakesh is a particularly popular place for tourists to seek out the sights and experiences that many associate with the country — colorful souks, gardens with ornate architecture and mosques from the Moorish period.

More Travel:

"We have consistently been ahead of the curve in finding hidden gem destinations for our customers to explore and remain committed to providing the most unique slate of travel options for their adventures abroad," United's SVP of Global Network Planning Patrick Quayle, said in a press statement.

The new route will launch on Oct. 24 and take place three times a week on a Boeing 767-300ER  (BA)  plane that is equipped with 46 Polaris business class and 22 Premium Plus seats. The plane choice was a way to reach a luxury customer customer looking to start their holiday in Marrakesh in the plane.

Along with the new Morocco route, United is also launching a flight between Houston (IAH) and Colombia's Medellín on Oct. 27 as well as a route between Tokyo and Cebu in the Philippines on July 31 — the latter is known as a "fifth freedom" flight in which the airline flies to the larger hub from the mainland U.S. and then goes on to smaller Asian city popular with tourists after some travelers get off (and others get on) in Tokyo.

United's network expansion includes new 'fifth freedom' flight

In the fall of 2023, United became the first U.S. airline to fly to the Philippines with a new Manila-San Francisco flight. It has expanded its service to Asia from different U.S. cities earlier last year. Cebu has been on its radar amid growing tourist interest in the region known for marine parks, rainforests and Spanish-style architecture.

With the summer coming up, United also announced that it plans to run its current flights to Hong Kong, Seoul, and Portugal's Porto more frequently at different points of the week and reach four weekly flights between Los Angeles and Shanghai by August 29.

"This is your normal, exciting network planning team back in action," Quayle told travel website The Points Guy of the airline's plans for the new routes.

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International

Walmart launches clever answer to Target’s new membership program

The retail superstore is adding a new feature to its Walmart+ plan — and customers will be happy.

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6 hours ago

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March 8, 2024

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It's just been a few days since Target  (TGT)  launched its new Target Circle 360 paid membership plan. 

The plan offers free and fast shipping on many products to customers, initially for $49 a year and then $99 after the initial promotional signup period. It promises to be a success, since many Target customers are loyal to the brand and will go out of their way to shop at one instead of at its two larger peers, Walmart and Amazon.

Related: Walmart makes a major price cut that will delight customers

And stop us if this sounds familiar: Target will rely on its more than 2,000 stores to act as fulfillment hubs. 

This model is a proven winner; Walmart also uses its more than 4,600 stores as fulfillment and shipping locations to get orders to customers as soon as possible.

Sometimes, this means shipping goods from the nearest warehouse. But if a desired product is in-store and closer to a customer, it reduces miles on the road and delivery time. It's a kind of logistical magic that makes any efficiency lover's (or retail nerd's) heart go pitter patter. 

Walmart rolls out answer to Target's new membership tier

Walmart has certainly had more time than Target to develop and work out the kinks in Walmart+. It first launched the paid membership in 2020 during the height of the pandemic, when many shoppers sheltered at home but still required many staples they might ordinarily pick up at a Walmart, like cleaning supplies, personal-care products, pantry goods and, of course, toilet paper. 

It also undercut Amazon  (AMZN)  Prime, which costs customers $139 a year for free and fast shipping (plus several other benefits including access to its streaming service, Amazon Prime Video). 

Walmart+ costs $98 a year, which also gets you free and speedy delivery, plus access to a Paramount+ streaming subscription, fuel savings, and more. 

An employee at a Merida, Mexico, Walmart. (Photo by Jeffrey Greenberg/Universal Images Group via Getty Images)

Jeff Greenberg/Getty Images

If that's not enough to tempt you, however, Walmart+ just added a new benefit to its membership program, ostensibly to compete directly with something Target now has: ultrafast delivery. 

Target Circle 360 particularly attracts customers with free same-day delivery for select orders over $35 and as little as one-hour delivery on select items. Target executes this through its Shipt subsidiary.

We've seen this lightning-fast delivery speed only in snippets from Amazon, the king of delivery efficiency. Who better to take on Target, though, than Walmart, which is using a similar store-as-fulfillment-center model? 

"Walmart is stepping up to save our customers even more time with our latest delivery offering: Express On-Demand Early Morning Delivery," Walmart said in a statement, just a day after Target Circle 360 launched. "Starting at 6 a.m., earlier than ever before, customers can enjoy the convenience of On-Demand delivery."

Walmart  (WMT)  clearly sees consumers' desire for near-instant delivery, which obviously saves time and trips to the store. Rather than waiting a day for your order to show up, it might be on your doorstep when you wake up. 

Consumers also tend to spend more money when they shop online, and they remain stickier as paying annual members. So, to a growing number of retail giants, almost instant gratification like this seems like something worth striving for.

Related: Veteran fund manager picks favorite stocks for 2024

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President Biden Delivers The “Darkest, Most Un-American Speech Given By A President”

President Biden Delivers The "Darkest, Most Un-American Speech Given By A President"

Having successfully raged, ranted, lied, and yelled through…

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9 hours ago

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March 8, 2024

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President Biden Delivers The "Darkest, Most Un-American Speech Given By A President"

Having successfully raged, ranted, lied, and yelled through the State of The Union, President Biden can go back to his crypt now.

Whatever 'they' gave Biden, every American man, woman, and the other should be allowed to take it - though it seems the cocktail brings out 'dark Brandon'?

Tl;dw: Biden's Speech tonight ...

  • Fund Ukraine.

  • Trump is threat to democracy and America itself.

  • Abortion is good.

  • American Economy is stronger than ever.

  • Inflation wasn't Biden's fault.

  • Illegals are Americans too.

  • Republicans are responsible for the border crisis.

  • Trump is bad.

  • Biden stands with trans-children.

  • J6 was the worst insurrection since the Civil War.

(h/t @TCDMS99)

Tucker Carlson's response sums it all up perfectly:

"that was possibly the darkest, most un-American speech given by an American president. It wasn't a speech, it was a rant..."

Carlson continued: "The true measure of a nation's greatness lies within its capacity to control borders, yet Bid refuses to do it."

"In a fair election, Joe Biden cannot win"

And concluded:

“There was not a meaningful word for the entire duration about the things that actually matter to people who live here.”

Victor Davis Hanson added some excellent color, but this was probably the best line on Biden:

"he doesn't care... he lives in an alternative reality."

*  *  *

Watch SOTU Live here...

*   *   *

Mises' Connor O'Keeffe, warns: "Be on the Lookout for These Lies in Biden's State of the Union Address." 

On Thursday evening, President Joe Biden is set to give his third State of the Union address. The political press has been buzzing with speculation over what the president will say. That speculation, however, is focused more on how Biden will perform, and which issues he will prioritize. Much of the speech is expected to be familiar.

The story Biden will tell about what he has done as president and where the country finds itself as a result will be the same dishonest story he's been telling since at least the summer.

He'll cite government statistics to say the economy is growing, unemployment is low, and inflation is down.

Something that has been frustrating Biden, his team, and his allies in the media is that the American people do not feel as economically well off as the official data says they are. Despite what the White House and establishment-friendly journalists say, the problem lies with the data, not the American people's ability to perceive their own well-being.

As I wrote back in January, the reason for the discrepancy is the lack of distinction made between private economic activity and government spending in the most frequently cited economic indicators. There is an important difference between the two:

  • Government, unlike any other entity in the economy, can simply take money and resources from others to spend on things and hire people. Whether or not the spending brings people value is irrelevant

  • It's the private sector that's responsible for producing goods and services that actually meet people's needs and wants. So, the private components of the economy have the most significant effect on people's economic well-being.

Recently, government spending and hiring has accounted for a larger than normal share of both economic activity and employment. This means the government is propping up these traditional measures, making the economy appear better than it actually is. Also, many of the jobs Biden and his allies take credit for creating will quickly go away once it becomes clear that consumers don't actually want whatever the government encouraged these companies to produce.

On top of all that, the administration is dealing with the consequences of their chosen inflation rhetoric.

Since its peak in the summer of 2022, the president's team has talked about inflation "coming back down," which can easily give the impression that it's prices that will eventually come back down.

But that's not what that phrase means. It would be more honest to say that price increases are slowing down.

Americans are finally waking up to the fact that the cost of living will not return to prepandemic levels, and they're not happy about it.

The president has made some clumsy attempts at damage control, such as a Super Bowl Sunday video attacking food companies for "shrinkflation"—selling smaller portions at the same price instead of simply raising prices.

In his speech Thursday, Biden is expected to play up his desire to crack down on the "corporate greed" he's blaming for high prices.

In the name of "bringing down costs for Americans," the administration wants to implement targeted price ceilings - something anyone who has taken even a single economics class could tell you does more harm than good. Biden would never place the blame for the dramatic price increases we've experienced during his term where it actually belongs—on all the government spending that he and President Donald Trump oversaw during the pandemic, funded by the creation of $6 trillion out of thin air - because that kind of spending is precisely what he hopes to kick back up in a second term.

If reelected, the president wants to "revive" parts of his so-called Build Back Better agenda, which he tried and failed to pass in his first year. That would bring a significant expansion of domestic spending. And Biden remains committed to the idea that Americans must be forced to continue funding the war in Ukraine. That's another topic Biden is expected to highlight in the State of the Union, likely accompanied by the lie that Ukraine spending is good for the American economy. It isn't.

It's not possible to predict all the ways President Biden will exaggerate, mislead, and outright lie in his speech on Thursday. But we can be sure of two things. The "state of the Union" is not as strong as Biden will say it is. And his policy ambitions risk making it much worse.

*  *  *

The American people will be tuning in on their smartphones, laptops, and televisions on Thursday evening to see if 'sloppy joe' 81-year-old President Joe Biden can coherently put together more than two sentences (even with a teleprompter) as he gives his third State of the Union in front of a divided Congress. 

President Biden will speak on various topics to convince voters why he shouldn't be sent to a retirement home.

According to CNN sources, here are some of the topics Biden will discuss tonight:

  • Economic issues: Biden and his team have been drafting a speech heavy on economic populism, aides said, with calls for higher taxes on corporations and the wealthy – an attempt to draw a sharp contrast with Republicans and their likely presidential nominee, Donald Trump.

  • Health care expenses: Biden will also push for lowering health care costs and discuss his efforts to go after drug manufacturers to lower the cost of prescription medications — all issues his advisers believe can help buoy what have been sagging economic approval ratings.

  • Israel's war with Hamas: Also looming large over Biden's primetime address is the ongoing Israel-Hamas war, which has consumed much of the president's time and attention over the past few months. The president's top national security advisers have been working around the clock to try to finalize a ceasefire-hostages release deal by Ramadan, the Muslim holy month that begins next week.

  • An argument for reelection: Aides view Thursday's speech as a critical opportunity for the president to tout his accomplishments in office and lay out his plans for another four years in the nation's top job. Even though viewership has declined over the years, the yearly speech reliably draws tens of millions of households.

Sources provided more color on Biden's SOTU address: 

The speech is expected to be heavy on economic populism. The president will talk about raising taxes on corporations and the wealthy. He'll highlight efforts to cut costs for the American people, including pushing Congress to help make prescription drugs more affordable.

Biden will talk about the need to preserve democracy and freedom, a cornerstone of his re-election bid. That includes protecting and bolstering reproductive rights, an issue Democrats believe will energize voters in November. Biden is also expected to promote his unity agenda, a key feature of each of his addresses to Congress while in office.

Biden is also expected to give remarks on border security while the invasion of illegals has become one of the most heated topics among American voters. A majority of voters are frustrated with radical progressives in the White House facilitating the illegal migrant invasion. 

It is probable that the president will attribute the failure of the Senate border bill to the Republicans, a claim many voters view as unfounded. This is because the White House has the option to issue an executive order to restore border security, yet opts not to do so

Maybe this is why? 

While Biden addresses the nation, the Biden administration will be armed with a social media team to pump propaganda to at least 100 million Americans. 

"The White House hosted about 70 creators, digital publishers, and influencers across three separate events" on Wednesday and Thursday, a White House official told CNN. 

Not a very capable social media team... 

The administration's move to ramp up social media operations comes as users on X are mostly free from government censorship with Elon Musk at the helm. This infuriates Democrats, who can no longer censor their political enemies on X. 

Meanwhile, Democratic lawmakers tell Axios that the president's SOTU performance will be critical as he tries to dispel voter concerns about his elderly age. The address reached as many as 27 million people in 2023. 

"We are all nervous," said one House Democrat, citing concerns about the president's "ability to speak without blowing things."

The SOTU address comes as Biden's polling data is in the dumps. 

BetOnline has created several money-making opportunities for gamblers tonight, such as betting on what word Biden mentions the most. 

As well as...

We will update you when Tucker Carlson's live feed of SOTU is published. 

Tyler Durden Fri, 03/08/2024 - 07:44

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