Wall Street Journal Highlights Portman’s Return to Work Incentive Proposal to Invigorate U.S. Economy
Yesterday, the Wall Street Journal highlighted Senator Portman’s proposal to boost the U.S. economy and incentivize individuals to return to work as we begin to reopen safely. Portman believes it is critical that we have a workforce that's ready to step into their old jobs or newly available jobs as the economy reopens. He believes this provision should be a part of the next coronavirus response stimulus legislation considered in the Senate. The Wall Street Journal article states:
“Senate Republicans are examining offering cash incentives for unemployed Americans returning to work, looking for an alternative to the extension of enhanced jobless benefits supported by Democrats…
“One idea is a proposal from Sen. Rob Portman (R., Ohio) to provide a temporary $450-a-week bonus for unemployed workers returning to work, on top of their wages.
“Mr. Portman says his proposal is good for employees ‘because they can go back to work, go back to their health care and go back to their retirement savings, and yet get a nice, nice bonus for doing so.’ The proposal also saves taxpayers money and ‘saves small businesses from going out of business because they can get workers.’”
Portman believes that a return-to-work bonus for individuals reentering the workplace would better help get the American economy running again. Portman’s proposal provides $450 a week for individuals returning to work, meaning they’d receive their wages plus this $450 bonus through July 31st. Portman believes this proposal would ensure that there are as few situations as possible where staying on unemployment is more lucrative than returning to work. The Wall Street Journal article highlighted his proposal:
“The plan is still being finalized, in part to work out the best mechanism for delivering the aid to workers. In its current formulation, the proposal would give $450 a week to laid-off workers to go back to work through July 31, the same date on which the extra $600 a week in unemployment benefits expires. The idea would also help states save money by potentially reducing their expenditures on unemployment benefits.
“Mr. Portman’s office settled on the amount by surveying benefits and wages in each state to come up with an average amount by which most people would be better off working than staying at home. The federal minimum wage is $7.25 an hour, meaning that a minimum-wage worker in states without a higher minimum, or floor, makes roughly $290 a week. The $450 payment each week on top of that base amount was designed with such low-wage workers in mind, in order to leave such employees better off than by taking $600 a week to stay home.”
According to recent research from the American Action Forum and from the University of Chicago, between 60-70 percent of individuals currently on unemployment are making more than they did in their prior job thanks to this federal supplement. Furthermore, the bottom 20 percent of wage earners are making, on average, double what they made in the workforce through this UI program. Portman is hopeful that, as the House and Senate work together on the next legislative package, they can focus on stimulating the economy and incentivizing people to get back to work.