Unemployment claims have surged in the wake of the coronavirus quarantines.
While states fielded hundreds of thousands of unemployment filings over the week of March 8, economists project that these numbers will grow by an order of magnitude in the coming weeks. Many expect between 1 million and 4 million new jobless claims by the end of March, numbers which don’t even account for workers ineligible for unemployment benefits.
As businesses shut down across the country and citizens are told to shelter in place until the worst of this virus has passed, millions of Americans find themselves needing to suddenly understand the unemployment system. It’s okay to look for help, even if you didn’t think you would ever need to file for unemployment benefits or enroll in Medicaid. These systems exist to buffer Americans at a time like this.
Here’s what you need to know to get through this hopefully short term period of need.
First: Unemployment Laws and Benefits Vary By State
While the federal government provides significant funding to help support unemployment programs around the country, by and large most unemployment benefit programs are run by the individual states. This means that the rules, requirements and processes will change depending on where you live.
This article is written to provide the most broadly applicable advice possible, but every state is different. Take care to look up the details of your own state’s unemployment policies before taking any action. The Department of Labor’s website is an excellent first step. Through their guide, you can find information on the details of each state’s unemployment programs and how to apply.
Second: Are You Eligible For Unemployment Benefits?
In any period of joblessness, it’s generally a good idea to look into filing for unemployment benefits. In ordinary times this system can provide some financial support while you find a new job and get back on your feet. Under the current quarantine, it can help you make ends meet while entire industries remain shuttered by force of law.
The first question to ask is, are you eligible?
Unemployed workers can generally file for benefits if they meet two criteria:
· First, they are unemployed through no fault of their own.
If you were laid off or had your hours significantly cut, for example, you may be able to file for unemployment. In MOST cases, if you quit or otherwise left your job voluntarily, you can’t. However, note that being forced out of your job does not count as leaving voluntarily. If you feel that your employer left you with no other choice but to leave, speak with a representative of your state agency. This is called “constructive termination” and you may still qualify for unemployment benefits.
Workers who were fired for cause typically do not qualify for unemployment benefits.
· Second, unemployed workers must have met “work and wage requirements.”
To claim unemployment, you have to have held a job.
This is more complicated than it seems. You must have been an employed worker, typically defined as someone who receives a W-2 form and for whom an employer paid payroll taxes. This is a difficult part of the system because it leaves many people out in the cold. Freelancers, gig workers and many small business owners are all not considered employed workers for the purposes of unemployment benefits.
If you are in some way self-employed and lose your income, you will not qualify for unemployment benefits.
· Third, Congress has issued some flexibility for states during the coronavirus.
During the coronavirus crisis, Congress has amended federal law to give states more flexibility in approving unemployment benefits. While each state will make its own decisions about specific implementation, they may choose to extend benefits to most workers whose livelihoods were disrupted by the coronavirus outbreak.
In particular, workers who leave their jobs because of the pandemic or who have been quarantined with the expectation of going back to work may qualify for unemployment benefits. Once again, this does not apply to self-employed workers or small business owners.
Third: What Is Your Health Care?
Once you have looked into unemployment benefits, the next issue to review will be healthcare.
Particularly for the next few months, it will be critical to ensure that you have some access to health insurance. For workers who have recently lost their jobs, this will most likely mean four options:
· Family Insurance: If you are under the age of 26, the Affordable Care Act may allow you to enroll or re-enroll on your parents’ health insurance. Access to this will vary based on the circumstances of your own family, however if you have parents with private health insurance (even through an employer), it may be a practical option.
· COBRA: If you received health insurance through your employer federal law allows you to keep your coverage for up to 18 months after a layoff or termination. This can be an excellent short term solution for workers who need coverage not to end, such as those who have been laid off due to the coronavirus pandemic. However understand that you will have to pay the full monthly premiums, making it an expensive solution in the long run.
· Healthcare.gov: The Affordable Care Act, otherwise known as Obamacare, created a marketplace for individual health insurance plans. If you lost health insurance when you lost your job it triggered what’s known as a “qualifying event,” allowing you to buy insurance on the marketplace even outside of the annual enrollment period.
· Medicaid: For individuals with few resources, Medicaid offers low-income health insurance options. As with unemployment benefits, every state runs its own Medicaid program and has its own qualifications. You can research your own state’s program through USA.gov.
Fourth: The Safety Net Is About More Than Unemployment
In the immediate future, you are likely going to rely on unemployment benefits to make ends meet. If you have lost your job, this will be the first place you go. This is doubly true if you have lost your job due to the coronavirus, as Congress has begun putting significant safeguards in place to help workers essentially freeze-in-place for the duration of the crisis.
If we’re all very lucky, the immediate crisis will pass in one or two months. In that case, unemployment benefits will simply be a bridge while you wait out the coronavirus along with everyone else.
However it’s important to understand that this is not the limit of assistance available to you. Federal, state and local agencies run a wide variety of programs designed to help individuals cover costs of living during difficult times. These range from SNAP (more commonly known as food stamps), utility assistance, housing vouchers and more.
It would be impossible for this article to summarize all of these programs, as they vary throughout the country. The website USA.gov is a good place to start, however. If you need more than unemployment benefits can provide, these programs may help.
Fifth: Budget Hard, Work Hard, Be Better
Do not slide into fun employment.
During the coronavirus quarantine it’s easy to feel like the whole world has been put on “pause.” In many respects that’s because it has. The coming government assistance will make it easy to shelter in place, waiting out the virus in your living room while watching Netflix (NFLX) - Get Report. That’s not an accident. From a public health standpoint, it’s a best case scenario. We want 330 million Americans to take a three week staycation; or at least as close as possible.
But in a few weeks or a few months the economy will come out of hibernation, and everyone who has been sitting on their couch will re-enter the workforce. If we’re all very lucky, we’ll do so in a roaring economy where employers can’t hire people fast enough. If not, we will face an ongoing recession while economists struggle to restart the business community. Either way, don’t waste this time you have right now.
Put together a series of projects that you want to accomplish while in quarantine. Soon enough it will be time to sit for a series of interviews and we can guarantee you that the first question out of everyone’s mouth will be “so what did you do in April?” Don’t be one of the millions who will answer “caught up on Adam Sandler movies.” Paint. Study the Roman Empire. Build something, if your home has the space for it, or learn Muay Thai if not. Do something that you can talk about when it’s time to sit across from a potential employer.
More than that, add to your skills. Download Duolingo and start learning a foreign tongue. If you’re technically minded, pick up a new coding language. Learn to mix better cocktails, a whole new technique for bookkeeping or how to manage SEO like a champ. Come back to the working world having used this time to skill-up, with new resume lines you can use when employers flood the market once again.
Against all odds, this is a chance to potentially improve your chances in the marketplace. There is hardship ahead for all of us, but also time. Use it wisely and you’ll do well.