Utopia Talk - Politics - US-EU unenployment differences

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Utopia Talk / Politics / US-EU unenployment differences

Habebe
Member Fri May 08 23:04:04
By MARCUS WALKER in Hohenlockenstedt, Germany, AND ROGER THUROW in Rockford, Ill.
In Germany, losing his factory job didn't stop Alfred Butt from taking a Mediterranean vacation this winter. Thanks to generous jobless benefits, being out of work "hasn't changed my life that much," Mr. Butt says.

In the U.S., Dylan DeRoberts lost similar work -- but there's no seaside getaway for him. Instead, he's giving up life's little pleasures, like riding his snowmobile, because he lost his insurance, too. "I've learned to live at a new level," Mr. DeRoberts says.

Unemployment is taking a very different human toll on opposite sides of the Atlantic, which helps explain why Europe and the U.S. can't agree on how to attack the global recession. The U.S. is spending hundreds of billions of dollars -- including increased assistance to the unemployed -- to prop up the economy, and wants Europe to follow suit. But most of Western Europe already has a strong, if costly, social safety net, so governments feel less pressure to spend their way out of trouble.

On the Line in Europe
View Interactive

Review unemployment and temporary worker data for the various euro-area countries

More interactive graphics and photos The irony is that for years, Europe tried to rein in its own worker protections -- long considered a drag on growth in good times -- to emulate the faster-growing U.S. economy. Now the U.S. is moving toward a more European system.

The differing U.S. and European approaches toward worker protections can influence recovery prospects. Unemployment is similarly high, above 8% and rising, both in the U.S. and among the 16 European countries that use the euro currency. But Europe's high payroll taxes, along with restrictions on when and how companies can lay off workers, make employers slower to rehire when a recession ends.

That's one reason why economists expect the U.S. to stabilize faster than Europe. Last month the International Monetary Fund predicted that the euro-zone economy will keep shrinking next year, whereas the U.S. should bottom out by then.

For Mr. Butt, losing his job as a raw-materials buyer for a German auto-parts maker was a serious blow. But state benefits will replace the bulk of his salary until May 2010. And he still has full medical insurance under Germany's universal system.

Mr. DeRoberts, who lost his job at a Chrysler assembly plant in Belvidere, Ill., near Rockford, last year, saw his medical benefits expire several months later. He says he can't afford to pay the premiums on his own.

"It's scary being without insurance," Mr. DeRoberts says, but adds: "What do I give up? Food?"

Alfred Butt, top, lost his German auto-parts job, but generous benefits meant he and his wife felt secure enough to vacation in Cyprus despite the setback. In the U.S., Dylan DeRoberts lost similar work and is tightening his belt.
Western Europe is seeing its share of worker discontent. On Friday, the annual "May Day" demonstrations in France and Germany attracted more people than in recent years.

But most protests are being aimed at specific employers rather than governments -- including France's recent spate of "boss-nappings," in which workers detain executives in their own offices to protest job cuts. Despite widespread unease at unemployment, there's relatively little public clamor to adopt U.S.-style stimulus spending.

The public mood isn't as bleak as the economic data. In Germany, gross domestic product has been in free fall since September. Most people think the crisis will get worse, according a recent poll by market-research group Emnid -- but 62% say they aren't feeling it themselves so far. In the U.S., only 13% say they're not at all affected personally, according to a recent Wall Street Journal/NBC poll.

Germany has built up a system of state-backed insurance for workers against illness, disability, old-age poverty and unemployment since the late 1800s. But benefits don't stay generous forever. Under a controversial labor overhaul in force since 2005, German unemployment benefits fall to a subsistence level after one year. The government decided the long-term jobless didn't have enough incentive to get off the dole, so it upped the pressure.

Jobless benefits vary around Europe, just as they can vary state-by-state in the U.S. But in most Western European countries, the state replaces 60% to 80% of the average worker's lost salary, compared with just over half on average in the U.S., according to the Organization for Economic Cooperation and Development.

European benefits also tend to last longer. In Belgium, jobless benefits have no time limit at all. In Denmark, the state replaces up to 90% of lost wages and invests over 4% of gross domestic product every year in supporting and retraining the jobless. By contrast, before the current crisis struck, the U.S. spent about 0.4% of GDP on retraining and benefits, according to the OECD.

Less-generous European countries include Greece, where initial benefits replace less than half of lost wages, on average. Heavily indebted households in countries such as the U.K. and Ireland, where property and lending bubbles have burst, are also particularly vulnerable in the recession. Economic pain in less-developed Eastern Europe is a separate and much deeper problem.

The European way takes a toll in taxes. In Germany, over half the total cost of employing somebody consists of income tax and mandatory contributions to programs including unemployment insurance and pensions. In the U.S., that figure is 30% -- meaning employees take home more of the money it costs to employ them.

The upshot: German workers cost significantly more to hire, on average, than U.S. workers, even though they can't buy quite as many goods with their take-home pay. That impacts both employment and consumer spending in Germany. On the other hand, Americans must pay extra for health insurance, unlike most Europeans.

The U.S. recently expanded unemployment and food-stamp benefits. New money for retraining the jobless, part of President Barack Obama's stimulus program, echoes government efforts in parts of Europe to give laid-off workers new skills.

In Illinois, Mr. DeRoberts, 32 years old, is benefiting from increased funding for the Dislocated Worker Program. The federal initiative provides job training and career counseling, and is being expanded by President Obama's stimulus spending.

The local Dislocated Worker office is providing about $6,000 of financing for Mr. DeRoberts to attend a two-year course in electronic engineering at Rock Valley College. He's hoping his studies might lead to a career in alternative energy, which President Obama has been touting as a future engine of the economy. Rockford recently attracted a Chinese solar-panel maker.

The big threat hanging over Mr. DeRoberts's plans is that his unemployment benefits run out in June, with a year of school to go. He worries he might have to cut his studies. "I'll get my last check and be going, 'What do I do now?'" he says, scratching his head in an exaggerated motion.

He and his girlfriend are expecting a baby in August, and he fears flipping burgers could be in his future. Anything to avoid a retreat into debt. "If I'm facing not being able to put food on my table, I'll take the first job I can get," he says, sitting on the edge of a chair in his living room.

Mr. DeRoberts, who worked for Chrysler from the age of 19, used to earn around $5,000 a month. Over the years, he'd moved up from bolting basic car parts into place, to troubleshooting the assembly-line machines. He even moved from Syracuse, N.Y., to the Belvidere plant as production shifted -- reflecting American workers' greater mobility compared with Europeans.

But then the Belvidere plant began struggling, eliminating a shift last year. With less seniority than other workers, Mr. DeRoberts felt vulnerable to further cuts. So he took a buyout. "I felt I could either take the buyout offer, or be forced to leave later, with nothing," he says.

He ended up with about $64,000, after taxes, which he used to clear debts. He also liked the idea of improving his education. "With a degree, I'll be ahead of the regular Joe Blow," he says.

Now he gets $1,426 a month in jobless benefits. In Illinois, benefits were extended to 59 weeks from 26 as part of the stimulus measures. Last month a special Illinois program, targeting prolonged unemployment, added 13 more weeks for some people; Mr. DeRoberts doesn't know yet whether he qualifies. His girlfriend makes slightly more at a local elementary school.

Their combined income is enough to cover rent for their two-bedroom apartment, electricity, groceries, car insurance and gasoline, but few frills. The couple rarely eat out, and they usually wait for $5 discount nights to see a movie.

The Rockford area was once among the most prosperous in the U.S., buoyed by thriving automotive and machine-tool industries. Its fortunes have declined, and today unemployment is hovering around 14%.

Getty Images

A job seeker looks at job listings posted at the East Bay Works One-Stop Career Center April 17, 2009 in Oakland, California.
The little German town of Hohenlockenstedt, where Mr. Butt worked, also used to be a manufacturing powerhouse. In the 1970s it had more industrial jobs than inhabitants; factories had to bus workers in.

Today, hardly any industry is left. In December, the auto-parts factory where Mr. Butt worked for eight years, HWU GmbH, announced its own shutdown. Workers protested, occupying the factory for a week. Mr. Butt, a burly 42-year-old, participated as employees barricaded the gates with forklifts and slept in the factory's canteen. Their demand: Save our jobs.

It was hopeless. Mr. Butt found himself out of work in January.

Normally, German workers get severance pay in large-scale layoffs, but HWU didn't have enough money. As a result, Mr. Butt's benefits are about as bad as it gets for a laid-off German factory worker.

Still, compared with the U.S., it's a lucrative package. First, he (and everyone else) got a job at a so-called "transfer" company, a private business that offers training and job-hunting advice with funding from the state and the former employer.

Through transfer companies, German workers can receive the bulk of their former salary for as much as a year before they even have to apply for unemployment. Mr. Butt is getting four months at 80% of his old salary of â?¬2,700 (roughly $3,600) a month. After tax, he's taking home about â?¬350 less than before.

From this month, he's on unemployment benefits for a year, which will cut his disposable income by an additional â?¬200 a month.

If he's still jobless by May 2010, he'll start feeling the pain. At least his wife has a job; she's a nurse at a rheumatism clinic. However, people with employed spouses don't qualify for Germany's long-term benefits.

He and his wife no longer go as often to their favorite Greek restaurant. But other than that, he says, he can still afford his lifestyle.

The couple decided to take a week's winter break in Cyprus as planned, even after he learned his factory would shut. "We still have enough income, and it was good to get away," says Mr. Butt.

It helps that he has only a small mortgage and no credit card. Like many Germans, Mr. Butt says, he and his wife "were brought up to believe that if you don't have the money to pay for something, you don't buy it." Germany's economy is expected to contract by around 6% this year, by far its worst performance since World War II, and worse than most U.S. forecasts. Still, Mr. Butt's biggest worry isn't surviving while jobless, it's finding another job -- because employers frown on applicants who've been unemployed a whole year. "People think you don't want to work," he says. "That's the main source of time pressure, not the benefit rules."

He spends most mornings searching online for vacancies in sales, purchasing or administration at all kinds of companies. There's little out there. "I thought finding a job wouldn't be a problem," he says. "I didn't think it would be so tough."

http://online.wsj.com/article/SB124155150793788477.html

interesting read.

Nekran
Member Sat May 09 02:58:35
"In Belgium, jobless benefits have no time limit at all."

Thought I had to react... this sounds somewhat misleading I think. The benefits deteriorate rather speedily and also regulations have been made far stricter the past few years... have to prove you're actively looking for work and can't just turn down offers for work or training by the VDAB (organization that helps people find work) anymore.

But I do suppose it is still limitless though... if you really don't get hired by anyone.

As the german guy says though... the real pressure for time is that large gap in your CV. Though really all you need is a good story for it :)

habebe
Member Sat May 09 03:00:53
Nekran, That does make alot more sense with a broader picture, thanks for the info.

Nekran
Member Sat May 09 03:14:09
Mind you, there's still plenty cases out there of people who're waiting for their benefits to deteriorate some more before it's worth it to go out working. If you only make a couple of bucks more a month working than you would doing nothing, that's not the best motivator... especially if you get added costs for things like daycare for a kid... a lot of young moms ride the unemployment benefits for a while, netting them both more cash and time for their kid.

There's definitely abuses of the system (though I don't think I mind my example of the young moms so much... they can use it) and people who like to ride the benefits, keeping a minimum of semi-realistic applications going to prove they're looking for work and so.

Still it's gotten stricter and there's more check-ups nowadays... and degrees of punishment (X weeks without benefits, X months without benefits, get scratched from benefits alltogether).

I prefer a system that's a little more abusable, but that helps the people who really need it well, than a harder to abuse one that screws over some good people.

We still have a lot of room for improvement to our system though, mind you.

habebe
Member Sat May 09 03:46:32
Nekran, I understand your support for a "more abusable system" (for lack of a better term, you know what I mean)

Now there is a system different from the US and Euro models, which is less abuseable, but seems very sound with one major exception. In some south American countries I've recently been reading up on their privatized unemployment accounts. the jist of the idea is that the money taken out of your paycheck that normally would go to fund unemployment insurances goes into a mandatory non-taxed fund which the individual can sit on or invest.The bonuses to this sort of system (atleast to the US model, I know less about the EUro models) is that in the US you must be laid off really to collect UI, so if you quit, or are fired for say being late repeditivley etc. you can not collect those benefits. In this sort of system you can, and any money you have leftover at retirment in this account can be rolled over into your IRA.

But the flaw I see in such a system is that it doesn't account for younger workers who may not have built up as much of a sustainable source of income.However with some tweaking I see alot of great potential in such a system. It can not be called an abuse of public funds when it isn't public funds, the plus side is that it also makes people more flexible about switching employment.

jergul
Member Sat May 09 04:39:17
The thing you have to ask is:

IF some jobs are not worth doing manually at all as they warp economic development by blocking automation.

AND if there are not enough jobs worth doing to employ the entire work age population

THEN why the worry if people voluntarily choose to periodically remove themselves from competing for the limited number of jobs available?

IF the issue is fairness, then of course the number of jobs should be increase by regulating legal work hours before overtime kicks in.

THEN benefits can be managed to encourage people to compete for jobs as required.

habebe
Member Sat May 09 04:41:24
"AND if there are not enough jobs worth doing to employ the entire work age population "

Self employment.

jergul
Member Sat May 09 04:45:47
Self-employment is just a job habebe. If you can find a niche, then all power to you.

Note that self-employment is generally not worth doing for monetary reward alone. The hours suck and hourly wage will tend to be low if you count hours worked properly (its far more than billable hours).

Its not for everyone and there is no reason people should be forced to employ themselves. That would bring back the return of tinkerers and day labourers on a massive scale (do you really enjoy having your windows washed at traffic lights that much?)

habebe
Member Sat May 09 04:49:11
I just don't see the the time when automation/robots take over so many jobs that human labor (of varying degrees) is no longer needed to such an extent as to cause any noticeable unemployment problems. Atleast anytime in the near future.

jergul
Member Sat May 09 04:51:59
You would have full employment at current economic output with a 1990s level of technology habebe.

habebe
Member Sat May 09 04:53:08
But we would also probably not have current economic output as high as it is with early 90's tech either.

jergul
Member Sat May 09 05:12:22
Of course not. That is why it is so important to allow automation take place naturally.

habebe
Member Sat May 09 05:15:28
Ok, good then we agree, right?

jergul
Member Sat May 09 05:19:57
Not sure. I have not change my stance, so it depends on how you view things.

habebe
Member Sat May 09 05:38:59
Well, you didn't actually disagree with anything I posted prior to you posting.

I just don't think that automation is going to made a noticeable effect in unemployment. While I agree we could probably lower unemployment by somehow abolishing the use of certain robotic machines and what not, thats absurd and we both agree that is not the right way to go about things.

As for this "THEN why the worry if people voluntarily choose to periodically remove themselves from competing for the limited number of jobs available? "

As long as they can support themselves independently and financially (not being paid by government, thus making higher taxes) I don't think anyone cares

jergul
Member Sat May 09 05:43:55
Of course they should be supported by government programs. They are doing people who want to work a favour and as there are not enough jobs to go around, government will end up supporting involuntary unemployment anyway even if you successfully compel everyone into wanting to work.

Government support for people not gainfully employed is pretty ingrained. Beginning at conception and ending 50 years after burial (at least here - when your grave can be re-used and the costs of upkeep passing on to benefit a new tenant).

habebe
Member Sat May 09 05:47:11
Well, we do disagree, but I'll be honest, I'm feeling rather lazy at the moment and don't feel like putting up a serious arguement, buy mabey later.

jergul
Member Sat May 09 05:50:19
Goes against the grain of the Lutheran workethic but its still a valid perspective.

Habebe
Member Tue May 12 15:12:45
ttt

show deleted posts

Habebe Member	Fri May 08 23:04:04 By MARCUS WALKER in Hohenlockenstedt, Germany, AND ROGER THUROW in Rockford, Ill. In Germany, losing his factory job didn't stop Alfred Butt from taking a Mediterranean vacation this winter. Thanks to generous jobless benefits, being out of work "hasn't changed my life that much," Mr. Butt says. In the U.S., Dylan DeRoberts lost similar work -- but there's no seaside getaway for him. Instead, he's giving up life's little pleasures, like riding his snowmobile, because he lost his insurance, too. "I've learned to live at a new level," Mr. DeRoberts says. Unemployment is taking a very different human toll on opposite sides of the Atlantic, which helps explain why Europe and the U.S. can't agree on how to attack the global recession. The U.S. is spending hundreds of billions of dollars -- including increased assistance to the unemployed -- to prop up the economy, and wants Europe to follow suit. But most of Western Europe already has a strong, if costly, social safety net, so governments feel less pressure to spend their way out of trouble. On the Line in Europe View Interactive Review unemployment and temporary worker data for the various euro-area countries More interactive graphics and photos The irony is that for years, Europe tried to rein in its own worker protections -- long considered a drag on growth in good times -- to emulate the faster-growing U.S. economy. Now the U.S. is moving toward a more European system. The differing U.S. and European approaches toward worker protections can influence recovery prospects. Unemployment is similarly high, above 8% and rising, both in the U.S. and among the 16 European countries that use the euro currency. But Europe's high payroll taxes, along with restrictions on when and how companies can lay off workers, make employers slower to rehire when a recession ends. That's one reason why economists expect the U.S. to stabilize faster than Europe. Last month the International Monetary Fund predicted that the euro-zone economy will keep shrinking next year, whereas the U.S. should bottom out by then. For Mr. Butt, losing his job as a raw-materials buyer for a German auto-parts maker was a serious blow. But state benefits will replace the bulk of his salary until May 2010. And he still has full medical insurance under Germany's universal system. Mr. DeRoberts, who lost his job at a Chrysler assembly plant in Belvidere, Ill., near Rockford, last year, saw his medical benefits expire several months later. He says he can't afford to pay the premiums on his own. "It's scary being without insurance," Mr. DeRoberts says, but adds: "What do I give up? Food?" Alfred Butt, top, lost his German auto-parts job, but generous benefits meant he and his wife felt secure enough to vacation in Cyprus despite the setback. In the U.S., Dylan DeRoberts lost similar work and is tightening his belt. Western Europe is seeing its share of worker discontent. On Friday, the annual "May Day" demonstrations in France and Germany attracted more people than in recent years. But most protests are being aimed at specific employers rather than governments -- including France's recent spate of "boss-nappings," in which workers detain executives in their own offices to protest job cuts. Despite widespread unease at unemployment, there's relatively little public clamor to adopt U.S.-style stimulus spending. The public mood isn't as bleak as the economic data. In Germany, gross domestic product has been in free fall since September. Most people think the crisis will get worse, according a recent poll by market-research group Emnid -- but 62% say they aren't feeling it themselves so far. In the U.S., only 13% say they're not at all affected personally, according to a recent Wall Street Journal/NBC poll. Germany has built up a system of state-backed insurance for workers against illness, disability, old-age poverty and unemployment since the late 1800s. But benefits don't stay generous forever. Under a controversial labor overhaul in force since 2005, German unemployment benefits fall to a subsistence level after one year. The government decided the long-term jobless didn't have enough incentive to get off the dole, so it upped the pressure. Jobless benefits vary around Europe, just as they can vary state-by-state in the U.S. But in most Western European countries, the state replaces 60% to 80% of the average worker's lost salary, compared with just over half on average in the U.S., according to the Organization for Economic Cooperation and Development. European benefits also tend to last longer. In Belgium, jobless benefits have no time limit at all. In Denmark, the state replaces up to 90% of lost wages and invests over 4% of gross domestic product every year in supporting and retraining the jobless. By contrast, before the current crisis struck, the U.S. spent about 0.4% of GDP on retraining and benefits, according to the OECD. Less-generous European countries include Greece, where initial benefits replace less than half of lost wages, on average. Heavily indebted households in countries such as the U.K. and Ireland, where property and lending bubbles have burst, are also particularly vulnerable in the recession. Economic pain in less-developed Eastern Europe is a separate and much deeper problem. The European way takes a toll in taxes. In Germany, over half the total cost of employing somebody consists of income tax and mandatory contributions to programs including unemployment insurance and pensions. In the U.S., that figure is 30% -- meaning employees take home more of the money it costs to employ them. The upshot: German workers cost significantly more to hire, on average, than U.S. workers, even though they can't buy quite as many goods with their take-home pay. That impacts both employment and consumer spending in Germany. On the other hand, Americans must pay extra for health insurance, unlike most Europeans. The U.S. recently expanded unemployment and food-stamp benefits. New money for retraining the jobless, part of President Barack Obama's stimulus program, echoes government efforts in parts of Europe to give laid-off workers new skills. In Illinois, Mr. DeRoberts, 32 years old, is benefiting from increased funding for the Dislocated Worker Program. The federal initiative provides job training and career counseling, and is being expanded by President Obama's stimulus spending. The local Dislocated Worker office is providing about $6,000 of financing for Mr. DeRoberts to attend a two-year course in electronic engineering at Rock Valley College. He's hoping his studies might lead to a career in alternative energy, which President Obama has been touting as a future engine of the economy. Rockford recently attracted a Chinese solar-panel maker. The big threat hanging over Mr. DeRoberts's plans is that his unemployment benefits run out in June, with a year of school to go. He worries he might have to cut his studies. "I'll get my last check and be going, 'What do I do now?'" he says, scratching his head in an exaggerated motion. He and his girlfriend are expecting a baby in August, and he fears flipping burgers could be in his future. Anything to avoid a retreat into debt. "If I'm facing not being able to put food on my table, I'll take the first job I can get," he says, sitting on the edge of a chair in his living room. Mr. DeRoberts, who worked for Chrysler from the age of 19, used to earn around $5,000 a month. Over the years, he'd moved up from bolting basic car parts into place, to troubleshooting the assembly-line machines. He even moved from Syracuse, N.Y., to the Belvidere plant as production shifted -- reflecting American workers' greater mobility compared with Europeans. But then the Belvidere plant began struggling, eliminating a shift last year. With less seniority than other workers, Mr. DeRoberts felt vulnerable to further cuts. So he took a buyout. "I felt I could either take the buyout offer, or be forced to leave later, with nothing," he says. He ended up with about $64,000, after taxes, which he used to clear debts. He also liked the idea of improving his education. "With a degree, I'll be ahead of the regular Joe Blow," he says. Now he gets $1,426 a month in jobless benefits. In Illinois, benefits were extended to 59 weeks from 26 as part of the stimulus measures. Last month a special Illinois program, targeting prolonged unemployment, added 13 more weeks for some people; Mr. DeRoberts doesn't know yet whether he qualifies. His girlfriend makes slightly more at a local elementary school. Their combined income is enough to cover rent for their two-bedroom apartment, electricity, groceries, car insurance and gasoline, but few frills. The couple rarely eat out, and they usually wait for $5 discount nights to see a movie. The Rockford area was once among the most prosperous in the U.S., buoyed by thriving automotive and machine-tool industries. Its fortunes have declined, and today unemployment is hovering around 14%. Getty Images A job seeker looks at job listings posted at the East Bay Works One-Stop Career Center April 17, 2009 in Oakland, California. The little German town of Hohenlockenstedt, where Mr. Butt worked, also used to be a manufacturing powerhouse. In the 1970s it had more industrial jobs than inhabitants; factories had to bus workers in. Today, hardly any industry is left. In December, the auto-parts factory where Mr. Butt worked for eight years, HWU GmbH, announced its own shutdown. Workers protested, occupying the factory for a week. Mr. Butt, a burly 42-year-old, participated as employees barricaded the gates with forklifts and slept in the factory's canteen. Their demand: Save our jobs. It was hopeless. Mr. Butt found himself out of work in January. Normally, German workers get severance pay in large-scale layoffs, but HWU didn't have enough money. As a result, Mr. Butt's benefits are about as bad as it gets for a laid-off German factory worker. Still, compared with the U.S., it's a lucrative package. First, he (and everyone else) got a job at a so-called "transfer" company, a private business that offers training and job-hunting advice with funding from the state and the former employer. Through transfer companies, German workers can receive the bulk of their former salary for as much as a year before they even have to apply for unemployment. Mr. Butt is getting four months at 80% of his old salary of â?¬2,700 (roughly $3,600) a month. After tax, he's taking home about â?¬350 less than before. From this month, he's on unemployment benefits for a year, which will cut his disposable income by an additional â?¬200 a month. If he's still jobless by May 2010, he'll start feeling the pain. At least his wife has a job; she's a nurse at a rheumatism clinic. However, people with employed spouses don't qualify for Germany's long-term benefits. He and his wife no longer go as often to their favorite Greek restaurant. But other than that, he says, he can still afford his lifestyle. The couple decided to take a week's winter break in Cyprus as planned, even after he learned his factory would shut. "We still have enough income, and it was good to get away," says Mr. Butt. It helps that he has only a small mortgage and no credit card. Like many Germans, Mr. Butt says, he and his wife "were brought up to believe that if you don't have the money to pay for something, you don't buy it." Germany's economy is expected to contract by around 6% this year, by far its worst performance since World War II, and worse than most U.S. forecasts. Still, Mr. Butt's biggest worry isn't surviving while jobless, it's finding another job -- because employers frown on applicants who've been unemployed a whole year. "People think you don't want to work," he says. "That's the main source of time pressure, not the benefit rules." He spends most mornings searching online for vacancies in sales, purchasing or administration at all kinds of companies. There's little out there. "I thought finding a job wouldn't be a problem," he says. "I didn't think it would be so tough." http://online.wsj.com/article/SB124155150793788477.html interesting read.
Nekran Member	Sat May 09 02:58:35 "In Belgium, jobless benefits have no time limit at all." Thought I had to react... this sounds somewhat misleading I think. The benefits deteriorate rather speedily and also regulations have been made far stricter the past few years... have to prove you're actively looking for work and can't just turn down offers for work or training by the VDAB (organization that helps people find work) anymore. But I do suppose it is still limitless though... if you really don't get hired by anyone. As the german guy says though... the real pressure for time is that large gap in your CV. Though really all you need is a good story for it :)
habebe Member	Sat May 09 03:00:53 Nekran, That does make alot more sense with a broader picture, thanks for the info.
Nekran Member	Sat May 09 03:14:09 Mind you, there's still plenty cases out there of people who're waiting for their benefits to deteriorate some more before it's worth it to go out working. If you only make a couple of bucks more a month working than you would doing nothing, that's not the best motivator... especially if you get added costs for things like daycare for a kid... a lot of young moms ride the unemployment benefits for a while, netting them both more cash and time for their kid. There's definitely abuses of the system (though I don't think I mind my example of the young moms so much... they can use it) and people who like to ride the benefits, keeping a minimum of semi-realistic applications going to prove they're looking for work and so. Still it's gotten stricter and there's more check-ups nowadays... and degrees of punishment (X weeks without benefits, X months without benefits, get scratched from benefits alltogether). I prefer a system that's a little more abusable, but that helps the people who really need it well, than a harder to abuse one that screws over some good people. We still have a lot of room for improvement to our system though, mind you.
habebe Member	Sat May 09 03:46:32 Nekran, I understand your support for a "more abusable system" (for lack of a better term, you know what I mean) Now there is a system different from the US and Euro models, which is less abuseable, but seems very sound with one major exception. In some south American countries I've recently been reading up on their privatized unemployment accounts. the jist of the idea is that the money taken out of your paycheck that normally would go to fund unemployment insurances goes into a mandatory non-taxed fund which the individual can sit on or invest.The bonuses to this sort of system (atleast to the US model, I know less about the EUro models) is that in the US you must be laid off really to collect UI, so if you quit, or are fired for say being late repeditivley etc. you can not collect those benefits. In this sort of system you can, and any money you have leftover at retirment in this account can be rolled over into your IRA. But the flaw I see in such a system is that it doesn't account for younger workers who may not have built up as much of a sustainable source of income.However with some tweaking I see alot of great potential in such a system. It can not be called an abuse of public funds when it isn't public funds, the plus side is that it also makes people more flexible about switching employment.
jergul Member	Sat May 09 04:39:17 The thing you have to ask is: IF some jobs are not worth doing manually at all as they warp economic development by blocking automation. AND if there are not enough jobs worth doing to employ the entire work age population THEN why the worry if people voluntarily choose to periodically remove themselves from competing for the limited number of jobs available? IF the issue is fairness, then of course the number of jobs should be increase by regulating legal work hours before overtime kicks in. THEN benefits can be managed to encourage people to compete for jobs as required.
habebe Member	Sat May 09 04:41:24 "AND if there are not enough jobs worth doing to employ the entire work age population " Self employment.
jergul Member	Sat May 09 04:45:47 Self-employment is just a job habebe. If you can find a niche, then all power to you. Note that self-employment is generally not worth doing for monetary reward alone. The hours suck and hourly wage will tend to be low if you count hours worked properly (its far more than billable hours). Its not for everyone and there is no reason people should be forced to employ themselves. That would bring back the return of tinkerers and day labourers on a massive scale (do you really enjoy having your windows washed at traffic lights that much?)
habebe Member	Sat May 09 04:49:11 I just don't see the the time when automation/robots take over so many jobs that human labor (of varying degrees) is no longer needed to such an extent as to cause any noticeable unemployment problems. Atleast anytime in the near future.
jergul Member	Sat May 09 04:51:59 You would have full employment at current economic output with a 1990s level of technology habebe.
habebe Member	Sat May 09 04:53:08 But we would also probably not have current economic output as high as it is with early 90's tech either.
jergul Member	Sat May 09 05:12:22 Of course not. That is why it is so important to allow automation take place naturally.
habebe Member	Sat May 09 05:15:28 Ok, good then we agree, right?
jergul Member	Sat May 09 05:19:57 Not sure. I have not change my stance, so it depends on how you view things.
habebe Member	Sat May 09 05:38:59 Well, you didn't actually disagree with anything I posted prior to you posting. I just don't think that automation is going to made a noticeable effect in unemployment. While I agree we could probably lower unemployment by somehow abolishing the use of certain robotic machines and what not, thats absurd and we both agree that is not the right way to go about things. As for this "THEN why the worry if people voluntarily choose to periodically remove themselves from competing for the limited number of jobs available? " As long as they can support themselves independently and financially (not being paid by government, thus making higher taxes) I don't think anyone cares
jergul Member	Sat May 09 05:43:55 Of course they should be supported by government programs. They are doing people who want to work a favour and as there are not enough jobs to go around, government will end up supporting involuntary unemployment anyway even if you successfully compel everyone into wanting to work. Government support for people not gainfully employed is pretty ingrained. Beginning at conception and ending 50 years after burial (at least here - when your grave can be re-used and the costs of upkeep passing on to benefit a new tenant).
habebe Member	Sat May 09 05:47:11 Well, we do disagree, but I'll be honest, I'm feeling rather lazy at the moment and don't feel like putting up a serious arguement, buy mabey later.
jergul Member	Sat May 09 05:50:19 Goes against the grain of the Lutheran workethic but its still a valid perspective.
Habebe Member	Tue May 12 15:12:45 ttt
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