I just read where one community will have 2,000 people lose their long-term unemployment benefits.
Assume, for the sake of argument, that these were minimum wage workers, working between 30 and 35 hours per week. The have been getting about $100 per week in unemployment benefits. Now, nothing.
That means they have, as a group, been spending about $200,000 per week in the local economy. Now, nothing.
Over the course of a year, $10,000,000 won’t be spent in local stores. But business owners won’t see a similar cut in their taxes. They’ll have to cut costs some other way, and the usual way is to reduce their workforce. This, in an area with a nearly 14% unemployment rate as it is.
And remember, unemployment benefits those who lost their job through no fault of their own. While those who just lost their benefits may have to pack up and leave, going whereever they can find work, the small businesses left behind will have to make do with $10,000,000 less this coming year.