September 20, 2020

Why Black Workers Will Hurt the Most if Congress Doesn’t Extend Jobless Benefits

The same pattern has persisted in heavily state-controlled programs like welfare: The larger a state’s Black population, the less generous its benefits.

“Yesterday’s racist system becomes today’s incidental structural racism,” said Kathryn Edwards, an economist at the RAND Corporation.

She has found that the geographic concentration of Black workers in stingier states means that the average maximum unemployment benefit a Black worker in America can receive per week is about $40 less than the average maximum benefit a white worker can get. That number might sound small, but Ms. Edwards points out that it adds up over 26 weeks of unemployment to a median rent payment in many states, or nearly the size of a $1,200 pandemic stimulus check.

If policymakers wanted to reduce racial disparities in what seem like race-neutral unemployment programs, William Spriggs, a Howard University economist, said they would want to do precisely the two things Congress did: expand the categories of covered workers, and increase the benefits they receive.

“What I did not anticipate fully and was shocked by,” Mr. Spriggs said, “was the South is also bad about running these programs.”

The most complicated part of the federal expansion was the entirely new program, called Pandemic Unemployment Assistance, meant for workers who wouldn’t normally qualify for state unemployment. This is the benefit that covers Uber drivers, self-employed hair stylists, and tipped servers or part-time retail workers whose reported earnings were too low to qualify normally.

Georgia and Florida were among the last states to begin making payments through that additional program (Florida’s labor force also has one of the highest shares of self-employed workers). And last week, Gov. Ron DeSantis of Florida publicly acknowledged that the state’s deeply troubled unemployment system introduced under the previous governor, Rick Scott, had been set up to frustrate workers and make as few payments as possible.

Article source: https://www.nytimes.com/2020/08/07/upshot/unemployment-benefits-racial-disparity.html

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