“I’ll be Better off on Welfare” When Working Is Worse Than Welfare

The labor market is so messed up right now that some folks are better off staying home on government assistance. 

Let that sink in. 

People have better outcomes not working than working because they don’t make enough money when they work to pay their bills, but government assistance ensures they’re not destitute. 

One woman came to the internet, baffled that her colleague quit after two days, saying she’s actually better off not working. 

Why is Not Working Better Than Working?

In this specific case, the employee who quit is a single mother.  She wants to work, but after childcare expenses, parking, commuting, and other deductions, she only has $200 left per pay period for all her other needs. 

That’s $400 for rent, food, utilities, and everything else. 

It’s not enough to live. 

Government assistance offers her food stamps, Medicaid, and free childcare so she can go to school. She can’t afford these things with her job. 

A Good Wage But Not a Living Wage

By 2002’s standards, she makes a fantastic wage. The company pays $22 per hour, which comes out to a little over $45,000 per year. Her take-home pay is a little over $3,000 monthly, after Federal Taxes, and is probably closer to $3,000 after state. 

The average cost of daycare for one child is $1230 per month. She has two children, meaning daycare costs her about $2500 monthly. 

She has to pay $100 per month for parking just to work, leaving her with about $400 for everything else. 

The Welfare Cliff

As this mother is well above the federal poverty line, she’s not eligible for welfare. The US has a fun system for determining welfare. The state decides how much you should make based on your family size. If you make less than that specific dollar amount, you’re eligible; if you make more, too bad for you. 

There’s no nuance, no slow slope allowing people to ease off government assistance and onto work. It’s a sharp cliff, and if you make even just one dollar over the line, you lose all your benefits. 

And the problem is that benefits often pay MORE than that line. 

For example, let’s say Welfare pays you $30,000 per year in overall benefits. But your state decides the cut-off point for getting any benefits is $20,000. If you make between $20,000 and $30,000, you lose all the benefits and earn LESS than you would have if you stayed on welfare. 

The system actively prevents people from improving themselves. 

Don’t Bash Single Mothers

Many people will start waxing poetic about the fact that this story revolves around a single mother. 

Stop. Just stop. 

No one wants to hear your talking points about what she could have, would have, or should have done. It’s easy to judge others from your cozy position, but you don’t know how or why she’s in this situation, so stop trying to tell her how she should have handled it. 

The System is the Problem

It’s the system, not single mothers, that’s the problem. Daycare shouldn’t cost more than rent. Employees shouldn’t have to pay to go to work. Welfare should ease people off on a gentle slope rather than throw them off a cliff. 

Many societal issues led us down this road where it’s more beneficial to stay on welfare than work. We must address those problems and make the system work for everyone. 

Source: Reddit