Will the increased benefits discourage people from working?

Nope! This has been a common talking point, but there are some serious logical flaws with it. (Not least of which is that there’s evidence that people who receive UI are more likely to look for work.)

A person cannot collect unemployment if they quit their job (unless it’s because of health concerns from COVID-19). Regardless of how it pays compared to their usual wages, to receive unemployment benefits a worker must produce a valid reason — i.e. layoffs, furloughs, significant hour cuts, or business closure — for why they were forced to stop working.

Furthermore, people who are receiving unemployment benefits typically receive better job offers compared to those who have used up their benefits, because they do not have to settle for lower-paying jobs to meet their immediate needs.

More generally speaking, most of the people receiving unemployment benefits during a recession are doing so because there are no jobs available. Evidence from this recession has shown that even the $600 weekly top-up to UI benefits didn’t discourage people from taking work, even if it paid less than their weekly UI benefits. People understand that unemployment benefits offer protection in the short-term, but a job provides more security in the long-run.