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Tag: furlough

  • Layoffs And Furloughs: What You Need To Know

    Layoffs And Furloughs: What You Need To Know

    The jobs numbers keep coming in and it’s far more dire than anyone has yet predicted. An additional 2.5 million jobless claims were filed in May alone, bringing the unemployment rate to more than 18%. In some places it is higher, and those numbers continue to climb every day. The pandemic has taken a toll on workers and businesses alike, shuttering businesses that aren’t essential or safe enough for people to use until the pandemic has passed. Bars and restaurants have been hit especially hard, and many of those businesses will not be able to make a comeback. Unemployment is tricky to navigate for the majority of people who have never needed to do so before, and supporting furloughed and laid off workers is going to continue to be crucial until the economy fully recovers.

    Layoffs and furloughs are a little different and require different resources to address. Layoffs are permanent separations from a company with the possibility of being recalled to work. Along with this method of separation, workers also lose any benefits such as health insurance, which means they will need access to COBRA in order to retain their healthcare, of particular importance in a pandemic.

    Furloughs are a little different from layoffs. Furloughed employees retain many of their benefits, such as health insurance, during the time they are not reporting for work. They also have the expectation of being called back to work after a given period of time, so their period of joblessness is finite though still unpaid.

    There are also other categories of workers who have lost their jobs or some of their income who may qualify for unemployment benefits in their states. Substitute teachers, freelance workers, and others who lack traditional employment structures don’t typically qualify for unemployment benefits, but new rules have allowed them to take advantage of a system they have long been prevented from using. Part time workers and those who had their hours cut have also previously been denied coverage but now also qualify for unemployment benefits in many states.

    Most notably, people who had no choice but to quit reporting to work in order to care for children or at-risk adult family members also now qualify for unemployment benefits.

    Navigating the unemployment system can be daunting. If you live in one state and work in another, file in the state in which you work. In most places you can file online if you have internet access, but of course if you don’t have internet access or an internet-capable device your options have become severely limited as libraries and coffee shops that typically offer free access have closed down.

    Because of the pandemic most states have waived the waiting period to apply for benefits, and the Federal Government is kicking in an additional $600 a month until the end of July.

    If you’ve never been unemployed before, it’s nothing to be ashamed about. You will recover from this. Learn more about how to navigate unemployment from the infographic below.

  • Unemployment Claims Rise Due to Shutdown & Glitches

    The unemployment weekly claims report released by the US Department of Labor indicates that initial unemployment claims rose to 374,000 this week, up 66,000 from the 308,000 total last week.

    The shutdown of the United States government was bound to impact the labor market, but the impact on these reported claims is perhaps less than one thinks. While 500,000 government employees are available to sign-up for unemployment benefits due to having been furloughed by the shutdown, these claims are filed under a different category. Thus, their numbers have not been added into this latest report from the Department of Labor.

    That being said, approximately 15,000 of the new claims can be directly related to private sector positions affected by the shutdown. Employees hired by government contractors or those who work in businesses near federal landmarks are among those private sector members who have seen the most drastic layoffs. URS Corp., a San Francisco-based engineering services firm, had to layoff around 3,000 workers due to the decreased workload from the government shutdown.

    About one-half of the increase in unemployment claims can be linked to glitches in California’s unemployment system. Last week, the state upgraded their computer systems. The glitch delayed new claims from being processed, meaning the backlog of new filings was just pushed through this week.

    The 66,000 new claim increase is the largest increase in jobless claims since superstorm Sandy hit in November of last year. That being said, the adjusted new claims, once all the anomalies are accounted for, is around 326,000. This number is almost directly in-line with the 4-week average of 325,000, therefore economists believe there is no real reason to worry about this particular surge.

    Chief US economist for Capital Economics, Paul Ashworth, stated that “The broader picture is still that labor market conditions are improving, albeit not quite as much as we previously thought.”

    Ashworth’s statements are corroborated by the fact that the continued, insured unemployment rate decreased by 16,000 from the previous week, meaning that people who were unemployed are finding work somewhere. Unfortunately, though, the extended unemployment rate continues to increase.

    The simple fact is that unemployment rates will continue to climb as long as the shutdown persists. While headway has been made with news of the Republicans willing to negotiate raising the debt ceiling, a positive economic turnaround still seems to be a long-ways down the road.

    Image via Wikipedia

  • Porta Potties Rescue Salem, MA During Shutdown

    Each October, Salem, Massachusetts, famous for its 1692 witch trials, holds a month-long festival called “Haunted Happenings” – though this year things have gotten complicated, with the partial shutdown of the federal government. The National Park Service was forced to close its Salem visitor center, including the bathrooms. Volunteers brought in porta potties to remedy the situation.

    Salem sees 25% of its annual visitors during the Haunted Happenings event, and mayor Kim Driscoll said the timing of the shutdown couldn’t be worse. The festivities include a withcraft expo, trick-or-treating and a psychic fair, and generates about $30 million. About 250,000 visitors are expected to arrive for the 32nd annual festival.

    Regardless of the shutdown, “People have stepped up, we got a makeshift visitor center set up, we brought in portable toilets, so anyone needing information isn’t gonna be lost,” Driscoll said. Yet, some visitors aren’t very pleased.

    Nancy Ryan of Manhattan, IL, says she hopes members of Congress have to come to Salem to use the porta potties “because that’s where they belong.” Because, they are like witches. Verna Hahn of Kelowna, British Columbia, said, “this is once-in-a-lifetime we are going to be here. We are not coming back, so it’s a lot of dollars the city is going to be losing if we are not here, spending our money, and that is a snowball effect on the local economy.”

    Local warlock Christian Day said, “if this shutdown doesn’t end soon, the Salem witches may have to get together and do a little magic to push it along.” Day went on to cast a spell to bring prosperity to the town.

    Diminished festivities aside, the government shutdown is having a real effect on furloughed workers who depend on their weekly paychecks to survive. Brian Kessler, an economist with Moody’s Analytics, predicts the economic impact could possibly be at least ten times greater than the simple calculation of wages lost by federal workers. His firm estimates that a three to four week shutdown could cost the economy roughly $55 billion dollars.

    Driscoll added, “nevertheless, we are resilient and are working through it pro-actively. Salem is open for business and ready to welcome the thousands of costumed revelers who come to our City every day through the month of October.”

    Image via YouTube.

  • Dog Eats Money, U.S. Mutilated Currency Div. Steps In

    A wily, one-eyed golden retriever from Montana named Sundance ate five Benjamins ($500 USD) worth his owner’s money last year, and the Mutilated Currency Division of the U.S. Department of the Treasury replaced it.

    Owner Wayne Klinkel was eating lunch with his wife, when Sundance got into a car cubby and ate the bills. Klinkel, a graphic designer in Helena, said when he’d returned to his car, all that was left was $1, along with a telltale remnant of a hundred dollar bill. Klinkel declared that Sundance is “notorious for eating paper products,” and that he “knew right away what had happened.”

    Klinkel had rescued Sundance from an animal shelter 12 years before, and the dog had later lost his left eye to surgery. For days after the $500 lunch, Klinkel followed Sundance around in the snow, collecting the remains of the cash. He’d left the frozen remnants outdoors in a baggie, and after weeks of hesitation, Klinkel thawed the dirty money in some soapy water. Who knew to add the soap?

    Using a hose and a mining screen, Klinkel was able to isolate the shredded money fragments for reassembly. “It was sort of like putting the puzzle pieces back together,” Klinkel said. He then ran the taped-up bills over to the Federal Reserve in Helena, which in turn told him to take a hike.

    Klinkel was eventually referred to the U.S. Department of the Treasury Mutilated Currency Division, where he mailed the befouled bills with a notarized letter on April 15. “There was no guarantee I was going to get anything back,” Klinkel said.

    According to the U.S. Department of the Treasury Bureau of Engraving and Printing, when mutilated cash is submitted, a letter should be included stating the estimated value of the currency, and an explanation of how the money became mutilated. Each case is carefully looked over by an experienced mutilated currency examiner. The amount of time needed to process each case varies with its complexity, as well as the caseload of the examiner. No word on how all of this works during a government shutdown.

    Though, the treasury department offers reimbursement for some proven cases of mutilated money, but it might take up to two years.

    Still, Klinkel finally received a check for $500 in the mail from the treasury on Monday. Alas, no one at the treasury was available for comment, as all department representatives are furloughed.

    Image via Wikimedia Commons.

  • Government Shutdown Imminent, For Once

    Government Shutdown Imminent, For Once

    Since Obama’s presidency began, there have been threats about a government shutdown. Fighting a two-front war and continuing to pay for ever-increasing Medicare, Medicaid, and Social Security programs have been the main culprits. Over the years, however, Democrats and Republicans have been able to resolve their differences in just enough time to avoid the shutdown.

    Things don’t look so great this time, though. By September 30, the government will hit its debt limit of $16.7 trillion dollars, meaning that it will have no more money to both pay its operations costs and its debts to other countries. While the term “shutdown” sounds big and scary, the event isn’t unprecedented. A government shutdown happened every year of Carter’s presidency, 6 times under Reagan, and the biggest shutdown occurred under Clinton in 1995-96.

    So, what exactly does it mean when experts say that the government will “shutdown”? Essentially, it means that the government will have to stop federal funding of certain programs, and will have to either lay-off or furlough its workers. But don’t worry – the federal government only eliminates those programs and workers that it deems “non-essential” for the operation or security of the nation – the military will still be paid, Congress will continue to operate, mail will still be delivered, police officers will still patrol the streets, courts will continue to operate, and Social Security benefits will still be paid. However, thousands of government workers will have to go on furlough (leave without pay – this is traditionally repaid whenever the government starts to operate once again), meaning that governmental operations will become less efficient. If you apply for Social Security, your claim could be delayed? Applying for a passport or VISA to travel to a foreign country? Expect that trip to come at a later date due to a delay in processing.

    There is a bigger implication, however. “If the federal government actually were to default on its debt obligations, the full faith and credit of the U.S. government is in question and it can have devastating effects on Treasury’s ability to borrow and on the stability of financial markets in general,” stated Keith Hennessey, former director of the National Economic Council. This means that the value of the American dollar would plummet internationally, leading to hyperinflation and the cost of goods drastically increasing in a very short period of time.

    Why can’t the Republicans and Democrats come to terms this time – the Affordable Care Act, more pejoratively known as Obamacare. The Republicans have taken a hard-nosed stance and have essentially said that if the Affordable Care Act is not repealed, then they will not agree to raise the debt ceiling and a government shutdown will result. On the other-hand, Obama’s press security has said that the government is not willing to accept a delay or repeal in the ACA in order to avoid a government shutdown.

    Republicans in Congress seem to believe that if the government shuts down, the American people will blame President Obama for his willingness to cooperate on the ACA issue. However, history shows that the Republicans will come out looking the fool. In the 1995-96 government shutdown, the Newt Gingrich-led Republicans pulled the same tactic Republicans are pulling today – they believed that if they held onto their morals and values staunchly enough, no matter the outcome, that the American people would flock to their side and catapult Republicans to office across the nation. That’s almost the exact opposite of what occurred.

    Instead of championing the stubbornness of the Republicans, the American people decided to re-elect Bill Clinton in a landslide vote. Voters decided that the actions of the GOP proved that they were not competent enough to run the government, and continued to place their faith behind Clinton (this was ultimately the end of Newt Gingrich). When the government was able to resume operations, Clinton was essentially able to get anything he wanted; all of the support was in his corner.

    So, how worried should the American people be? Chris Krueger, an analyst for Guggenheim Partners, a global financial services firm, believes that “Government Shutdown Odds Increase to 40% … We are raising our odds of a government shutdown in 14 days to 40% from a 1 in 3 probability. We are basing the 60% odds that there will not be a government shutdown on blind faith because there is little to no evidence to suggest that the House, Senate, and White House can agree to a stopgap measure in time.”

    But please, whatever you do, don’t decide that this is a good time to reenact the Panic of 1837. Unemployment is already bad enough, and America definitely isn’t ready for another Andrew Jackson.

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