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Marketplace Morning Report

Why many government workers aren’t eligible for unemployment benefits

Marketplace Morning Report

Marketplace

Business, News

4.5927 Ratings

🗓️ 27 February 2025

⏱️ 7 minutes

🧾️ Download transcript

Summary

The Supreme Court is giving the Trump administration more time to pay for foreign aid work done before the administration froze foreign assistance. Among those caught up in all this are independent contractors who have contracts with the U.S. Agency for International Development. Their work has evaporated, but they can’t file for unemployment. We’ll discuss. Plus, an account from a day laborer and volunteer sheds light on economic conditions for low-income immigrant workers.

Transcript

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0:00.0

Many government workers getting thrown out of work are not eligible for unemployment benefits.

0:07.0

I'm David Brancaccio. The Supreme Court is giving the Trump administration more time to pay for the foreign aid work done before the administration froze foreign assistance.

0:18.0

The High Court ruling puts a temporary hold on a lower court order

0:22.6

that had said the money had to get paid by yesterday. Among those caught up and all this are

0:27.5

independent contractors who have contracts to work with the U.S. Agency for International Development.

0:33.2

Their work has evaporated. But they can't file for unemployment. Marketplaces Nancy Marshall

0:38.2

Gensar has been looking into this. Nancy, why is this the case? Well, David, unemployment benefits

0:43.8

are funded by a tax. Companies pay on their employees' wages, but contractors aren't employees.

0:51.2

They're considered small businesses. At Kathy Creighton at Cornell University's

0:55.8

School of Industrial and Labor Relations explained it to me this way.

1:00.1

Pretty much in almost every state in the country, independent contractors do not get

1:05.8

unemployment insurance benefits. And that's because they don't pay into the system so they don't get money

1:12.5

out of the system. And Creighton says just a very few states allow independent contractors,

1:18.6

these gig workers, to collect unemployment benefits. So this brings us to the government contractors

1:25.3

who were caught up in the Trump administration's work to

1:27.7

dismantle USAID in the name of cost cutting. Work for many of those contracts is drying up.

1:34.9

Yeah, they're feeling the ripple effects of the dismantling of USAID, David. So, for example,

1:41.0

I talked to one contractor, Leanne Evanson.

1:44.3

She just had a $40,000 contract canceled.

1:47.4

She's essentially a freelancer hired by nonprofits who do work for USAID.

1:52.9

She writes reports and grant applications.

1:55.4

She has no work now, and as we said, is not eligible for unemployment.

...

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