She makes $250/week working, and $700/week on unemployment. What will she do now?
In February, a month’s paycheck just barely covered rent for a 25-year-old Bluffton woman who worked part time at the Tanger Outlet Mall.
She spent her days taking care of her two young children and her nights working at the outlet store for hourly pay. Like many parents, she missed dinnertime and bedtime and saw the rest of her paycheck go straight to childcare so she could go to work.
All of that stopped in mid-March, when the store closed due to the coronavirus shutdown.
Now, her weekly unemployment checks cover rent, and she has some left over for utility bills, car payments and the never-ending stream of diapers her two kids seem to use. She’s bringing in over $700 per week from the program.
Her initiation into the unemployment system has left her with an unexpected, but shared, reality.
“I’m making more money now on unemployment than I was working,” she said.
In a time where so many people are facing new financial challenges, some who work in accommodations and retail in Beaufort County are coming to the sobering realization that state and federal benefits for not working surpass what they made doing their jobs.
The Bluffton woman agreed to share her story and an intimate look at her specific financial situation on the condition she not be named. The Island Packet and Beaufort Gazette agreed in this instance because the story is an important one few people are willing to talk about but believed to be a widely shared experience.
Despite her relief in having a way to pay the bills during the coronavirus pandemic, the woman said she feels the weight of the stigma attached to unemployment benefits and anxiety about the future when her store reopens.
“I don’t want to go back and make $250 per week, struggle to find childcare and ask [her children’s] dad for money,” she said.
An unemployment balancing act
From March 16 through May 5, the state has paid out $831 million in unemployment benefits.
As restaurants, salons and retail stores begin to reopen in Beaufort County, many employees are facing tough decisions on how to return to work and how to handle their individual slices of that $831 million.
If you rush back to work a slow day at a restaurant or commission-based job, you could lose money for essential expenses by giving up unemployment. For parents, returning to work full time while school is still out means organizing, and paying, for childcare.
But if you delay going back to work, you could be ostracized by co-workers, risk losing your job or hearing from the unemployment insurance fraud department.
The right combination is likely somewhere in between. In some cases, partial unemployment payments can continue as people go back to work — providing a cushion for fixed expenses while returning to some semblance of normalcy.
A time to pay bills?
The constant stress of money looms large in the Bluffton woman’s mind.
Rent is $1,220. Weekly pay is between $250 and $300. She can’t afford childcare if she works more than part time.
When the pandemic began, her already precarious financial situation became dire.
“My job was paying me, even though we weren’t working,” she said. “It was an average based on hours I was working per week, so I was getting about $230 per week. But they cut us off on May 1.”
She turned to her sister for help filing for unemployment, which now awards her over $700 per week.
“I’m getting $713 per week, and I thought ‘perfect, I can stay home with the kids, and I don’t have to worry about paying for childcare just for me to go work part time.’”
The help from the state means she can afford to pay her rent every other week instead of scraping together money at the end of the month. The payments help her get ahead on car payments and save money for the future.
As of Thursday, her store in the Tanger Outlets hasn’t reopened. She still has 11 weeks of eligibility left under the state unemployment program.
But that hasn’t stopped her from looking forward.
Once her store offers a spot on the schedule, she’s obligated to take it, even though that will mean cutting her monthly income in half.
‘They’ve all come back to work’
As Beaufort County employers come out of their pandemic-induced closures, some are expecting difficulties returning staff to their schedules.
“Surprisingly we’ve retained all of our staff. They’ve all come back to work,” Dave Peck, the owner of A Lowcountry Backyard and Pool Bar Jim’s on Hilton Head Island, told The Island Packet on Monday.
Peck said he was surprised because “a lot of our staff was making more money off the clock than they were on the clock.”
Although some restaurant workers on the island can make over $300 per night in tips in high season, a mere trickle of visitors — and diners’ anxiety about contracting the virus — mean unemployment still brings more money than tips for many.
And retail workers, who are paid hourly, are likely going back to a paycheck far less than their unemployment benefits.
Regardless, the state maintains that unemployment cannot be a permanent fix.
“We don’t want to give the impression that anyone has a choice between returning to work and collecting unemployment,” S.C. Department of Employment and Workforce Chief Legal Officer Todd Timmons told The Island Packet.
When to go back to work
Here’s the skinny on unemployment. There are four types of assistance for people who have lost their jobs:
- S.C. Unemployment Insurance: This is the most common type of benefit, Timmons said. People who have been laid off through no fault of their own (such as their restaurant or store closing due to coronavirus) are eligible for up to 20 weeks of unemployment insurance. It’s paid for by employers who pay payroll taxes. Benefits are generally capped at $326.
- Federal Pandemic Unemployment Compensation: This is perhaps the most well-known unemployment program, as it promises $600 per week on top of existing unemployment insurance. The program is federally funded under the CARES Act, and recipients can get their weekly benefits until July 25.
- Pandemic Emergency Unemployment Compensation: This program essentially acts as an extension for people who have exhausted their 13 weeks of unemployment insurance. It is federally funded and was enacted by the CARES Act legislation.
- Pandemic Unemployment Assistance: The program acts as a catch-all for people who may not be eligible for other benefits, including those who are self-employed or gig workers who do not pay payroll taxes into the unemployment insurance fund. It is federally funded and can last up to 39 weeks.
Timmons said the most important thing to remember about all state and federal assistance is that “any of these benefits are only available to people who cannot work.”
The government defines people who cannot work as those whose jobs have been eliminated or made impossible by COVID-19, such as if their place of employment closes, they or a family member are diagnosed with the illness, or if essential operations such as childcare centers are closed.
As soon as an employer reopens, Timmons said, employees should go back to work.
If employees are brought back with reduced hours, such as restaurant workers who get half their usual shifts because South Carolina restaurants can fill to only 50% capacity, those people can report their wages and receive partial benefits.
“We’re not going to stop your benefits until you have a chance to have your say,” Timmons said. “The best thing you can do is if you can truly work, go to work.”
The stigma of getting government help
As the number of unemployed people in the American workforce grows, the national understanding of who turns to the government for assistance is changing.
“In the last two months the state has experienced a swing from historic lows in unemployment rates prior to the pandemic to initial claim filings that have more than quadrupled the numbers of the Great Recession,” according to the Department of Employment and Workforce.
Nearly 500,000 South Carolinians have applied for unemployment benefits since the start of the pandemic. Even including the 13-week extension provided by the CARES Act, the state’s unemployment benefits are among the shortest in the nation.
But the woman in Bluffton still feels the need to justify her benefits.
“I’m not just out here living life and using the money for things I don’t really need,” she said. “It’s for a car payment, car insurance, diapers, the light bill. ... It’s just so beneficial to me. It’s kind of a blessing to be able to stay home with my kids and pay my rent.”
Even amid the coronavirus pandemic and an upheaval of the labor market, the Bluffton woman fears being labeled lazy. Researchers acknowledge that stigma.
“Unemployment can be regarded as an example of stigma of character, where the stigmatized are considered individuals with a ‘weak will, domineering or unnatural passions, treacherous and rigid beliefs, and dishonesty,’” according to a 2019 study by German researchers titled “The social stigma of unemployment.”
But the woman in Bluffton joins thousands of South Carolinians in using the benefits — among them real estate agents, servers, recreation guides and hotel employees — and admits she’d never thought she’d be the one on government assistance.
“I want to be independent. I don’t want to have to ask people for money,” she said. “I also don’t boast about being on unemployment either. It’s kind of personal.”
During the coronavirus, unemployment is preserving her family.
BEHIND THE STORY
MOREWhy we didn't name a source in this story
Discussing unemployment benefits and pay at work is a deeply personal issue. While the details of the above Bluffton woman’s story are compelling, our newspapers are protecting her identity because we’ve recognized a real threat of her losing her employment because she is speaking up about pay. Her employment details and unemployment claims have been independently verified.
This story was originally published May 15, 2020 at 4:00 AM.
