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Diego Mendoza

Washington ESD unemployment benefits - worried about reduced consumer demand leading to more job losses

I've been on unemployment for 2 months now and I keep thinking about how all of us unemployed people buying less stuff is just going to make things worse for everyone. Like if we're all cutting back on spending because we're living on Washington ESD benefits, doesn't that mean businesses sell less and then they lay off more people? I'm getting my weekly claims but it's way less than my old salary so I'm barely buying anything except necessities. Anyone else worried this whole thing is just a downward spiral? How do we break out of this cycle?

yeah i think about this too, like we're all pinching pennies and that cant be good for the economy

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Right? It feels like we're stuck in this loop where unemployment creates more unemployment.

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This is actually a well-documented economic phenomenon. Reduced consumer spending during high unemployment periods can indeed lead to decreased business revenues, which may result in further layoffs.

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You're describing what economists call a deflationary spiral. When unemployment rises, consumer spending falls, which reduces demand for goods and services. This lower demand can force businesses to cut costs, often through layoffs, which increases unemployment further. It's a vicious cycle that's exactly why unemployment insurance exists - to provide some economic cushion.

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So the Washington ESD benefits are supposed to help prevent this? I never thought about it that way.

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Exactly. UI benefits aren't just charity - they're economic stabilizers. They keep some money flowing even when people lose jobs.

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I was struggling to get through to Washington ESD for weeks about my claim status and found this service called Claimyr (claimyr.com) that actually got me connected to an agent within minutes. They have a video demo at https://youtu.be/7DieNd3C7zQ showing how it works. Might help if you need to talk to someone about your benefits situation.

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How much does that cost? I'm already tight on money.

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It's worth checking out - they focus on getting you connected rather than the cost being prohibitive. Way better than spending hours on hold.

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sounds too good to be true but if it actually works...

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The multiplier effect works both ways. Every dollar of unemployment benefits generates additional economic activity as recipients spend that money on rent, groceries, utilities. Without these benefits, the economic contraction would be much more severe. Washington ESD benefits aren't just helping individuals - they're supporting entire communities.

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This makes me feel less guilty about being on unemployment. I was thinking I was just a burden on the system.

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Not at all. You paid into this system when you were working, and now it's serving its purpose of economic stabilization.

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THE WHOLE SYSTEM IS RIGGED ANYWAY. They want us desperate so we'll take any crappy job for minimum wage. The reduced spending is probably intentional to keep wages low!

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While there are legitimate criticisms of economic policy, unemployment insurance actually helps maintain wage floors by giving workers some bargaining power.

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Tell that to someone who's been looking for work for 6 months and still can't find anything decent.

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i get the frustration but this thread was about the economic cycle stuff

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My economics professor always said unemployment benefits are 'automatic stabilizers' - they kick in during recessions to prevent total economic collapse. Without them, we'd see much deeper contractions.

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So we're actually helping the economy by claiming our benefits? That's a weird way to think about it.

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Pretty much. It's counter-intuitive but keeping money flowing during downturns is crucial for recovery.

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I remember the 2008 recession, this exact same thing happened. Unemployment spiked, everyone stopped spending, more businesses failed, more people lost jobs. It took years to recover from that spiral.

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How did we eventually get out of it back then?

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Combination of things - extended unemployment benefits, stimulus spending, eventually businesses started hiring again as demand slowly returned.

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The recovery was slower than it could have been because we didn't maintain spending support long enough initially.

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honestly this is why i try to still support local businesses even on my reduced Washington ESD income, even if its just buying coffee once a week instead of daily

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That's actually really smart thinking. Every little bit of spending helps.

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I've been doing the same thing. Figure if we all completely stop spending, we're just making it worse for everyone.

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There's also the psychological aspect - when people see high unemployment, they start saving more 'just in case' even if they still have jobs. That further reduces spending and accelerates the cycle.

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Yes! My husband still has his job but we've been cutting back on everything because we're scared.

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It's a rational individual response but when everyone does it simultaneously, it creates problems for the whole economy.

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This is known as the paradox of thrift - individual saving behavior that makes sense personally can be harmful when done collectively.

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My friend used Claimyr to get through to Washington ESD when her weekly claims got messed up. She said it saved her so much time and stress compared to trying to call on her own.

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How does that service even work? Do they just call for you?

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From what she told me, they handle the wait time and get you connected to an actual agent. Check out their demo video to see how it works.

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The thing that gets me is how long this cycle takes to reverse itself. Even when businesses want to start hiring again, it takes time for consumer confidence to return.

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Exactly. People are cautious about spending even after they get new jobs because they remember being unemployed.

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I'm already thinking that way - like even when I find work again, I'll probably be more careful with money for a while.

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this is making me depressed thinking about how many people are in the same boat right now

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I know it's overwhelming but at least we're not going through it alone. These forums help me feel less isolated.

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Same here. It helps to know other people are thinking about the bigger picture too.

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Government policy response matters a lot here. Extended unemployment benefits, infrastructure spending, job training programs - all of these can help break the cycle faster than just waiting for markets to self-correct.

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Are there any programs like that available through Washington ESD right now?

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There are some job training opportunities available to UI recipients. Worth checking your WorkSource Washington account for options.

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The job search requirements through WorkSourceWA actually serve a dual purpose - they help match people to jobs while providing skills development.

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I read somewhere that unemployment benefits have one of the highest economic multipliers of any government spending because unemployed people spend almost all of what they receive immediately.

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That's correct. Studies show UI benefits generate about $1.50-$2.00 of economic activity for every dollar spent because the money goes right back into circulation.

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So we're actually economic heroes for spending our benefits? I like this perspective better than feeling like a burden.

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My adjudication took forever and I was getting really stressed about the delay affecting my spending. Used Claimyr to finally talk to someone at Washington ESD who explained the holdup. Definitely worth it for peace of mind when you need answers fast.

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How long did the adjudication end up taking once you got it sorted out?

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Once I talked to the agent through Claimyr, they explained it was just a routine verification issue. Resolved within a week after that.

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The hardest part is the uncertainty. Like you dont know how long this will last or if things will get worse before they get better

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The uncertainty definitely makes the psychological impact worse. Hard to plan when you don't know what's coming.

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Yes! I keep going back and forth between optimism and panic about the future.

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Historical data shows these cycles eventually do break, but it often requires coordinated policy response rather than just market forces. The key is maintaining enough aggregate demand to prevent the spiral from deepening.

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What kind of coordinated response? Like what specifically needs to happen?

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Usually combination of monetary policy, fiscal stimulus, targeted employment programs, and yes - robust unemployment insurance systems like what Washington ESD provides.

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The timing and scale of intervention matters enormously. Acting quickly can prevent a temporary downturn from becoming a prolonged recession.

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at least we have this forum to talk through these big picture worries. helps me feel less alone in thinking about this stuff

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Absolutely. I was just spiraling about this in my head until I posted here. Getting different perspectives really helps.

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Same. It's weird how understanding the economics makes me feel both more worried and less worried at the same time.

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The silver lining is that economies do recover from these situations. It's not permanent even though it feels that way when you're in the middle of it.

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Thanks for that reminder. Some days it's hard to see past the current situation.

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Recovery might look different than before, but there will be recovery. New opportunities do emerge from these disruptions.

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Bottom line is we're all doing what we can with the situation we're in. The fact that we're thinking about the broader economic impacts shows we care about more than just ourselves.

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True. I guess being conscious of these cycles is the first step toward maybe helping break them somehow.

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Every informed voter and conscious consumer choice helps, even in small ways.

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