Last week’s news that Massachusetts now has more jobs than it did just before the start of the Great Recession was greeted appropriately with cheers. A senior vice president at AIM (Associated Industries of Massachusetts), the state’s largest employer trade group, applauded this way: “Despite all the fits and starts, ups and downs, we have over time created a significant number of jobs and brought ourselves most of the way if not all of the way back out of the recession in terms of employment. The numbers are really pretty remarkable.”
The numbers are pretty remarkable, especially when compared to other states. AIM might have tempered the rather self-congratulatory tone of its comment by mentioning the role that the federal government had played in stabilizing the economy, starting with the more than 18.5 million weeks of additional unemployment insurance (UI) benefits paid to nearly 700,000 unemployed Massachusetts workers long after their employers’ obligations to them had expired. Without the consumer demand that those benefits fueled during the past five years, we would not be in the relatively fortunate position we are today.
But it’s really not surprising that AIM did not mention UI in its celebratory comments. Only two days later, the group was back to its customary hand-wringing, imploring the state to change our UI law to lower employer costs. Massachusetts provides some of the most generous unemployment benefits in the country, AIM says, which makes businesses here less competitive. But Massachusetts is a high-wage (and high-cost) state, and our unemployment benefits, while perhaps high in absolute terms, replace only 37 percent of a worker’s average wage, very close to the national average. And the benefits are capped at $674 per week.
I was thinking of asking the state’s corporate executives how they would like to try to get by on $674 per week, or even 37 percent of their wages, but since that latter number would be well into the millions annually, I will reconsider and ask a different question. Why is it that Massachusetts must strive to be second to none when it comes to education, infrastructure and some other important components of a successful economy, but we must strive to be second to all when it comes to protecting our workforce against job loss? I think it has to do with who’s paying the tab.