> So why give up those benefits for an uncertain, unstable gig-worker job with Instacart?
Two reasons:
1. If you make less than the unemployment rate for the week in a gig job, from my understanding you will get topped up by unemployment to the max level you were eligible for. So taking a gig worker job has no bottom side risk (income wise) if true, just the opportunity to make more than you would on unemployment. I can’t guarantee this is true everywhere, but I’ve heard anecdotally of it being true in some states.
2. I know of / know directly a bunch of tech industry workers across who were furloughed / laid off and live in NYC. Salary range for tech jobs here is all over the place depending on position, so to simplify the math, let’s make a WAG and say $104k annually is the average (likely low, but some roles in tech in NYC are way under $100k). So their weekly pay is equivalent to $2k/week.
NY unemployment caps out at a very low ~$500/week, give or take $50, and so even with the $600 kicker (when you finally start getting it, it’s delayed and backfilled to start), it’s an almost 45% cut in salary without notice and on top of that, you might be stuck spending on cobra for insurance depending on employer generosity.
Cobra can easily cost $700/month for an individual (what I’ve paid before anyway), and could be easily over a grand for a family who has great medical coverage as is generally the case with tech jobs. So now that $1100 pay/week (which takes multiple weeks to actually start coming in generally, hope you have savings or a severance) is starting to look more like $800-900/week.
Given rents on the low end are generally greater than 2 weeks of that level pay (if not a lot more), can you start to see how unattractive unemployment gets?
I’m lucky and still am employed, but if I wasn’t, even in the best case where my employer pays cobra for some duration, I wouldn’t be able to pay my rent with 100% of the unemployment benefits (and I live in a cheaper area, for the size place, than is average for NYC metro with reasonable commutes), let alone any other bills.
I think you may not be factoring in the extra $600/week, which I mention in my comments. Even if you are, the following points still apply:
#1: That may depend on state. Where I'm at, you only get to keep half of any income you earn while unemployment, and even that caps out at $200. So gig work worth $400/week will earn you $200. Is that worth the risk of Covid exposure? States like NY & NJ, the hardest hit for unemployment as well, are having mini outbreaks at grocery stores.
#2. What you were making before you got fired isn't relevant in this discussion: This is about which is the better choice, unemployment vs. gig work (instacart) . What matters is whether you can earn more from gig work than unemployment + $600. And again, add in the extra Covid exposure risk to the gig-work equation
Regarding NY unemployment caps: Again, doesn't matter if gig work is paying less than unemployment + $600. And as always, covid exposure risk. To expand on that topic, if you or someone you live with is in a high-risk group, nothing else really matters: food shopping gig work is a very dangerous option.
Regarding health insurance: Compared to instacart, you're better off with cobra: Instacart gives access to Stride health plans. I just got a quote: $1200/month for an extremely high deductible plan ($7k) , $1450/month for a merely high deductible plan ($4k).
Regarding rent: If unemployment + $600 is the same or more than you were making, you're no worse off than when you had a job.
So the questions remains: Why would you choose a gig worker job that is unstable, lacks benefits, and exposes you to extra covid risk if you can make about the same collecting unemployment? If I were in that position, I'd stick with unemployment. If I had the opportunity for a stable job with halfway decent benefits, even if it paid less than unemployment + $600 then I'd take it. If unemployment benefits ran out, I'd be screwed: I'm in a high risk group for Covid-19, as is my wife-- gig work that gives me a high risk for exposure is a really bad option. The only reasonable option for me would be to strip down expenses to the bare minimums, ask the bank to defer mortgage payments, and hope things are better in 6 months.
Two reasons:
1. If you make less than the unemployment rate for the week in a gig job, from my understanding you will get topped up by unemployment to the max level you were eligible for. So taking a gig worker job has no bottom side risk (income wise) if true, just the opportunity to make more than you would on unemployment. I can’t guarantee this is true everywhere, but I’ve heard anecdotally of it being true in some states.
2. I know of / know directly a bunch of tech industry workers across who were furloughed / laid off and live in NYC. Salary range for tech jobs here is all over the place depending on position, so to simplify the math, let’s make a WAG and say $104k annually is the average (likely low, but some roles in tech in NYC are way under $100k). So their weekly pay is equivalent to $2k/week.
NY unemployment caps out at a very low ~$500/week, give or take $50, and so even with the $600 kicker (when you finally start getting it, it’s delayed and backfilled to start), it’s an almost 45% cut in salary without notice and on top of that, you might be stuck spending on cobra for insurance depending on employer generosity.
Cobra can easily cost $700/month for an individual (what I’ve paid before anyway), and could be easily over a grand for a family who has great medical coverage as is generally the case with tech jobs. So now that $1100 pay/week (which takes multiple weeks to actually start coming in generally, hope you have savings or a severance) is starting to look more like $800-900/week.
Given rents on the low end are generally greater than 2 weeks of that level pay (if not a lot more), can you start to see how unattractive unemployment gets?
I’m lucky and still am employed, but if I wasn’t, even in the best case where my employer pays cobra for some duration, I wouldn’t be able to pay my rent with 100% of the unemployment benefits (and I live in a cheaper area, for the size place, than is average for NYC metro with reasonable commutes), let alone any other bills.