Should You Still Collect Unemployment Benefits If a New Job Offer Pays Less?

That’s a question that bears asking in a very iffy economy.  Say for example, you collect unemployment benefits of $15 per hour, but a new job as a bill collector only pays about $11 per hour.  It does make sense to continue with the unemployed help than to accept the offer and lose your benefits.  But of course, the choice is not as black and white as that.

Depending on the state they are living in, retrenched workers usually collect unemployment benefits for six months although federal assistance can extend unemployed help in case of loss of a job to as much as two years. Considering studies that it takes about eight months for a worker to find a new job in America, two years is still a very long time.  Don’t forget, unemployment benefits do not come out of thin air, they come from the shrinking pockets of fellow Americans.

On one hand, the long-term assistance does provide a false sense of security for some Americans working in white-collar work to wait “for a better job” to come along rather than the low-pay, high-sweat blue-collar employment they may be offered. On the other hand, there are families out there who are in serious need of help and the unemployment benefits they receive are the only lifeline that prevents them from spiraling into debt.

It can’t be denied that some Americans are abusing the system: they collect unemployment benefits unnecessarily, it still boils down to one’s moral fibers.  It’s a good thing that the majority of the unemployed are actively looking for a job (that’s actually a requirement to receive benefits but that’s not the only reason), not just because of the security and stability they provide but also to boost their self-esteem. Anybody who hasn’t experienced what’s it like to not work do not understand its impact to one’s psyche.

The choice therefore is clear:  either find menial work at below minimum wages or continue to collect unemployment benefits and live off the sweat of the rest of other Americans who are also struggling with the economic slowdown. Most laid-off workers, fortunately enough, are still making the right choice.

What are you thoughts on this subject?

This article was written by Rance Trammela, a paralegal blogging at Secrets About Unemployment.  He covers everything from tax-related topics, to post-resignation depression, the effects on the family unit, and personal finances. The views expressed in this post are those of the author. The appearance of this article on my blog does not indicate an endorsement for any product or service.

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19 thoughts on “Should You Still Collect Unemployment Benefits If a New Job Offer Pays Less?

  • I’m a white collar office worker and if I was unemployed I would look for another white collar job. I wouldn’t even look at a blue collar job unless I am really desperate. At that point I would probably take a smaller pay check.

        • I’m far from lazy but I’ve worked hard to get 2 degrees that would allow me to work in an office setting. Since I spent the money to get educated in this way, I should use my knowledge. But as I said, no job is beneath me. I would just try to get an office job FIRST because this is what I know. I couldn’t expect to know how to do a carpenter’s job for instance, I don’t expect him to know how to do mine.

    • “Blue collar” doesn’t always mean less money than “white collar.” It’s funny to me that people still even use these stupid and outdated terms, frankly – and it’s silly to me that people still don’t understand that just because you’re a so-called blue collar worker, doesn’t mean you’re making less. In fact, Mike Rowe of Dirty Jobs states he met 38 millionaires while making his show – and, of course, they were ALL “blue collar.” He also stated that, according to statistics they found, the blue collar jobs started around $40,000 a year and within a couple years most people were making $80,000 to $100,000 – AND those jobs are not being filled — employers are clamoring for people! So don’t be so closed minded and archaic with your thinking. Trying a laborer job might get you out into the sunshine, put some muscle on your skinny body, and make you a lot more money than you ever dreamed it could!

  • Aside from the ethical implications of being a slug and collecting unemployment when a viable job offer exists, the longer you’re out of the work force, the tougher it will be to EVER get a similar role again in the future. Job skills are becoming obsolete quickly. If you’re gonna play that game, you may regret it when the gravy train pulls out.

  • I think it depends on your education level. If you’re unskilled then that automatically puts you in a certain pay range. Unfortunately, some unskilled jobs (like working in a factory) paid very well and are not easily replaceable if the jobs go overseas. In that case I might go into a trade.

    I’m an engineer in sales, so in my case, I would hold out for another engineering job, unless I wanted to totally change pace and do a career change. Most people even at the higher salary brackets took some sort of pay cut when the re-entered the workforce. It’s classic supply and demand.

    I’d be surprised if a lot of people got back to where they originally were after a layoff.

  • This is a tough/touchy subject. Yes, I’m sure there’s plenty of people who have no choice but to live off unemployment, but I can also see where others get frustrated because there’s some people who COULD go out and get a job, but they’re “mooching” off of our hard work instead. I think once/when/if the economy gets back to normal, we won’t have to worry about the unemployment benefits being extended and what not. But for now, it’s somewhat of a catch 22

  • It really depends on what benefits the new job will bring you. I agree that continuing to collect unemployment seems unfair to those who pay into the system, but that’s only because the system now exists as redistributive welfare rather than as a true insurance against unemployment.

    I agree with many of the commentators, but if you have perverse incentives that encourage some people to loaf instead of working, you can’t blame people for that. Fix the system instead.

    At some point the benefits will run out, so you always have to evaluate if you’re better off by jumping now or waiting for something better to come along.

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