One of the best reasons for not extending unemployment benefits is that their ongoing use is creating a disincentive to rejoin the workforce.
There’s logic to this, and on some level it definitely happens. We’ve known people, personally, who have made the calculation to not take work because getting of unemployment wasn’t worth it.
But today’s big uptick in the unemployment rate showed something important: Discouraged workers are coming back to the market, looking for jobs, and they’re not finding them.
This should torpedo the notion that there are plenty of jobs out there, if only people wanted to come take them.
The jobs aren’t there yet, so a key argument against extending unemployment insurance is blown up.
Now of course, this probably won’t end the debate in actuality, because politics is involved, and spending is on-popular.
But right now the situation is set up perfectly for Obama to cave on the tax cuts AND maybe to get more UI as a bargaining chip.
Business Insider Emails & Alerts
Site highlights each day to your inbox.