Mon, 17 Jun 2019

U.S. government employees bear the brunt of shutdown

Jay L. Zagorsky - The Conversation
13 Jan 2019, 23:25 GMT+10

President Donald Trump wants US$5.7 billion tofund a border wallto keep out undocumented immigrants and criminals. Democrats in Congress say thewall is a waste of moneythat wouldnt solve any ofAmericas actual immigration programs.

Caught between the two sides are about800,000 federal workerswhose agencies are affected by the partial government shutdown. And although it started about three weeks ago,Jan. 11 markeda significant milestone: It was the first time affected workers didnt get their paychecks.

As a researcher who studiespeoples wealth,Iunderstand that while the loss of a single paycheck may not seem like much, for many American families it can be devastating financially.

The federal workforce

Overall, the federal government directly employs over 2 million people.

Most of them workfor departments such as Defense, Education and Labor that remain open because Congress passed spending bills fully funding what they do. About a quarter of the federal government including the Departments of Homeland Security, Justice and Agriculture has no new funding, leaving 800,000 workers in the lurch.

About380,000 have been furloughed without pay, while 420,000 aredeemed essentialand have to report for work. However, these essential workers are not being paid either.

And on Jan. 11, they started tofeel the impact of that lost pay.

So whats the big deal if these workers dont get a single paycheck?

The problem is many Americans both in and out of government live paycheck to paycheck. Estimates range anywhere fromone-thirdto more thanthree-quartersmake ends meet every two weeks.

No matter which figure is right, it means that many American families cannot financially survive for long without earning money. And a significant sharedont have enough moneyto absorb even a $1,000 emergency expense let alone a prolonged period of time without a paycheck.

Theres some good news for government workers who have been furloughed. They are eligible forunemployment insurance, a federally mandated, state-run program that protects workers incomes when they lose their job through no fault of their own.

Workers who sign up for unemployment insurance can receive a portion of their wages for up to half a year. For example, Virginiatells federal workersthey will get anywhere from a minimum of $60 to a maximum of $378 a week if they ask for benefits, depending on their past salary. Washington, D.C.,offersup to $425,all taxable. But even the maximum is barely a quarter of the weekly equivalent of the average federal salary of$84,000 per year.

Essential government employees inspecting bags at airports or guarding the president, however, have a much tougher problem. They are not eligible for unemployment insurance, which means their only recourse is drawing on their savings if they have enough ortaking outa loan.

Going without a paycheck for a few weeks is hard enough. If the shutdown lasts months or years as Trumphas threatened the situation could get very dire for the average government worker.

And while Congress is required to eventually pay those who worked during the shutdown, theres no guarantee that it will pay workers that it forcibly furloughed.

While its hard to know when this shutdown might end, the good news is that Congress tends to give all affected workers back pay, regardless of whether they worked during the impasse. Thats what happened in 2013, whenlawmakers unanimously approvedpaying everyone back.

The bad news is that 800,000 workers are caught in the middle of a political dispute over a wall. And in simple terms, the government is taking a no-interest loan from these workers as they seek (or not) to resolve it.

Resolved or not, I predict two other unfortunate consequences: More talented workers will quit the federal bureaucracy and more will avoid taking federal government jobs in the future.

(The writerJay L. Zagorsky is Adjunct associate professor atBoston University).

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