Coloradoans Refusing to Go Back to Work Because Unemployment Benefits Pay More
The Regional Economic Development Institute at Colorado State University has determined that the majority of Coloradoans receiving unemployment benefits are making more than they were making at their jobs. The cutoff point for this number is about $30 an hour, meaning if you make less than that there is financial incentive not to return to work. Since the majority of workers unemployed due to the crisis were working in low paying service sectors, recipients could be receiving up to 150% more than they were making while employed.
Unemployed workers are currently receiving both state and federal benefits, with the CARES Act providing an extra $600 a week between the end of March and the end of July to those who have lost their jobs due to the pandemic. This is incentivizing workers not to return to work as they are receiving more money than usual.
Additionally, the matter becomes even more complicated when considering the PPP Loans. The PPP Loans requrie that small businesses maintain at least 75% of their staff or they risk having to repay the loan within two years. This makes employers want to have their staff in, even if they are not doing much, but there is no incentive for staff making minimum wage to come in to a low-paying job when just the CARES Act alone covers their wages, with the added bonus of any state wages. Several employers have made formal complaints about employees refusing to come in to work, but the state has not yet cut any unemployment benefits for this, though in normal times refusal to work negates your ability to collect unemployment. State government says it’s too difficult to determine why someone may be refusing to come in to work, such as if they are vulnerable or are caring for someone who is vulnerable, and these complaints will be addressed at a future date.