JONATHAN COHN JULY 12, 2010
The Philadelphia Inquirer reports that yet another prominent Republican politician seems to think we could cut unemployment significantly if only we would cut benefits:
Republican gubernatorial candidate Tom Corbett on Friday accused some jobless Pennsylvanians of choosing to collect unemployment checks rather than going back to work, prompting swift criticism from his Democratic opponent and one of the state's top labor leaders.
"The jobs are there. But if we keep extending unemployment, people are just going to sit there," Corbett told Harrisburg radio station WITF at a campaign stop in Elizabethtown. "I've literally had construction companies tell me, 'I can't get people to come back to work until . . . they say, "I'll come back to work when unemployment runs out." ' "
(h/t Steve Benen at the Washington Monthly.)
Do unemployment benefits reduce the incentive to seek work? Yes: workers receiving unemployment benefits aren’t quite as desperate as workers without benefits, and are likely to be slightly more choosy about accepting new jobs. The operative word here is “slightly”: recent economic research suggests that the effect of unemployment benefits on worker behavior is much weaker than was previously believed. Still, it’s a real effect when the economy is doing well.
But it’s an effect that is completely irrelevant to our current situation. When the economy is booming, and lack of sufficient willing workers is limiting growth, generous unemployment benefits may keep employment lower than it would have been otherwise. But as you may have noticed, right now the economy isn’t booming--again, there are five unemployed workers for every job opening.
In other words, a few workers in Pennsylvania may be turning down jobs, or may not really be seeking them, because unemployment benefits are more generous. But the vast majority simply can't find work.