The current recession has been called the worst since the Great Depression. As a nation, the U.S. had a national unemployment rate of 8.9% by April 2009. This figure constitutes 13.7 Million of workers (labor force of 154.7M), and is up from 8.5% just a month earlier. Of course, this is a sign that things have yet hit an all time low.
Because this issue has affected so many people, the implications of unemployment have constituted a regular discussion, in media and on the individual level. And while it’s better to remain employed in most cases, there are often marked benefits from not working. Let’s take a look at some of the most important pros and cons of being unemployed in this economy:
If’ you’ve paid enough into it, unemployment benefits can be quite satisfactory. It’s usually enough to live on, and you don’t have to do anything to receive it. To make matters better, due to the recent Economic Stimulus, the first $2,400 in benefits is tax free. In this sense, individuals collecting unemployment can fare better than members of the workforce, and they get to wear sweat pants while doing it.
Perhaps the most beneficial aspect of unemployment is free time. This is a great opportunity to reflect on previous work history, and to plan the next steps in one’s career. For those curious about or interested in working in different fields, this is a great time to explore other opportunities. This free time is also be useful when it comes to long-term financial planning, thinking about relocation, and other family matters that most people are too busy to dedicated time to.
For those that have always wanted to go back to school and pursue a different career, one of the best times to do this is during a period of unemployment. One of the main reasons why people don’t go back, is because of the need to earn money, as opposed to taking out student loans. Furthering one’s education with Uncle Sam paying for room and board is quite the arrangement.
Save on Associated Costs of Employment
For professionals, there are many expenses tied to working that often go underestimated or even ignored. These include: professional attire, transportation, and dining out. While these costs vary depending on the industry and the employer, these costs come out of the worker’s pocket and constitute expenses all would prefer to avoid.
Health and Fitness
Most working adults do not take the time (or have the time) to live healthy lives. For many, it is easy to dine out because of a hectic schedule, and exercising can be the last thing any one wants to do at the end of a long work day. A common story for the recently unemployed is that they finally find the time to prepare their own healthy meals, and start exercising regularly. The former is also a useful way to save money.
Even though unemployment benefits can be enough to sustain oneself when not working, they typically do not leave overage for savings. For those that remain employed, they are able to continue saving and putting money away in their retirement funds. And with employers that match contributions to a retirement fund, this can be that much more important. Additionally, for those trying to pay off debt, earning more than unemployment certainly can help.
Remaining employed is also important because of employee benefits. While savings and retirement are important, medical and dental insurance can be even more so. This is especially the case for those with families, for which buying insurance can be extremely expensive. Those that have ever needed medical attention without insurance would attest to this.
While the recession has caused many individuals to take a pay cut, or even a reduction of their employee benefits, there is no denying the importance of financial stability. While there are many Americans now on unemployment benefits, there are many that could not afford to live on this. For these individuals, it would be beneficial to stay with a company that reduced pay or benefits, if they were still earning above what they’d be collecting from unemployment. Every little bit counts.
Many liken the implications of a recession to Social Darwinism, in that only the employees with the most utility will remain with jobs. Furthermore, those that survive lay offs will be well poised for security and career advancement when the economy turns around. Especially, when their company begins hiring people and growing once again. This can supplant one’s role in a company, should cuts be made in the future.
Consistent Work History/Resume
Another important benefit from remaining employed is remaining employed. For workers that anticipate career moves in the future, showing a prospective employer that they were able to remain in work during a recession says a lot. It also prevents the need to explain gaps in employment history on a resume, and illustrates experience and expertise.