US Helps People After Job Loss; Denmark, the UK & Netherlands Help Workers Keep Jobs Instead
'The US is helping people after they've lost their jobs in the coronavirus pandemic. Here's how 3 European countries are helping workers keep them instead.' Business Insider, March 25, 2020.
•The coronavirus is inflicting severe damage on global economies, and working-class citizens are among the most at risk from being laid off from shuttered businesses.
•In Europe, governments in Denmark, the Netherlands, and the UK moved to pay workers to stay at home and do nothing in an attempt to salvage their battered economies.
•In Denmark, the government is promising to pay up to 90% of a worker's salary to private businesses as long as the worker is not laid off.
•The American response in the $2 trillion coronavirus stimulus bill is focused on mostly helping people after they've lost their jobs.
- Waterfront, Copenhagen, Denmark.
Millions of Americans are projected to file for unemployment benefits as the coronavirus pandemic shutters businesses, leading to massive layoffs. Many economists say the US is almost certainly in a recession already.
But the havoc it's wreaking on global economies threatens to inflict severe pain on the working class in particular, The New York Times reported. Businesses around the world have closed their doors in an effort to curb the virus's spread. Nations are also sealing off their borders and ordering millions of citizens to stay at their homes. The crisis is highlighting differing attitudes toward how governments strengthen the safety net. In Europe, one idea is catching on in the fight against the coronavirus: Pay workers to stay home and do nothing.
The calculation among governments in Denmark, the Netherlands, and the UK appears to be that its better to pay up and keep people on payrolls than risk economic disruption from mass layoffs. It's an approach that could be comparable to freezing economies in place and letting them thaw at the end of the pandemic. In the US, most of the attention among lawmakers has been squarely focused on boosting unemployment benefits and expanding eligibility for people to receive them after they've lost their jobs.
The $2 trillion coronavirus economic relief bill in Congress includes provisions to increase payments to the jobless by $600 per week on top of their state benefits, as well as send $1,200 checks to Americans earning less than $75,000, according to NBC News. Businesses with 500 or fewer employees are also set to get zero-interest bank loans to keep worker on payrolls for two months. Those loans could be forgiven if the private firms don't lay off any workers, but some of that spending could still be paid back if conditions aren't followed.
Diane Lim, a former economist at the White House Council of Economic Advisors who now works at the Penn Wharton Budget Model, said there's a huge need for people to "hit pause on their usual economic activity" to keep the virus from spreading further. But she says the federal government needs to find ways to compensate people and give them an incentive to stay home. "We're asking for people to do something that is at great private individual cost for the sake of the public good," Lim told Business Insider. "That's exactly when the government needs to step in. Government needs to subsidize that." Here are more details surrounding the plans now underway in the three European nations mentioned above.
Denmark is covering up to 90% of workers' wages for employers — as long as they're not laid off...
More, https://markets.businessinsider.com/news/stocks/europe-fight-coronavirus-pay-workers-wages-plan-economy-stay-home-2020-3-1029031212
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