It is estimated that 508,000 people could become unemployed due to the economic impacts of covid-19 . While some 233,000 would enter informality.
An option for these citizens to receive resources temporarily is unemployment insurance. Therefore, the National Government proposes to expand the coverage of this service and facilitate access to it.
Currently, unemployment insurance has the capacity to cover up to 550,000 people, reported the Ministry of Finance. This benefit is a monthly outlay of 70% of the current Unified Basic Salary ($ 400 this year) for five months, that is, $ 280 a month.
The Executive’s proposal is to reduce the time to access this aid. This would be reduced from 60 days to one week. In addition, not only dependent members who lose their jobs could apply, but also independent workers and voluntary members residing in the country.
Economic analyst Hugo Villacrés recalls that in 2015, in the Labor Justice Law, unemployment insurance was created with the same objective as the Unemployment Fund: to help people who lost their jobs. He explains that of the contribution made to social security (20.6% between the employee and the employer), 1% goes to unemployment insurance and 2% to the unemployment fund.
On the one hand, the Fund is an individual account where the resources of each affiliate are accumulated. If he is out of a job, the person can access his money. If you do not occupy it, you receive it when you retire. While insurance is a joint solidarity account to which all affiliates contribute. It is used by anyone who has the need to do it.
The insurance and the fund that cover unemployment cannot be used in the same contingency. In other words, those who are left without a job due to this health emergency must take advantage of one or the other.
The analyst, who was president of the Board of Directors of the Ecuadorian Social Security Institute (IESS), believes that a problem that could arise with insurance during this emergency is that it loses liquidity.
This is because there are more applicants due to the reduction of requirements or because many people could lose their jobs at the same time. But it is precisely for these contingencies that this solidarity insurance was created, says Villacrés.
Due to the situation, the expert believes that it is positive that people access unemployment insurance as soon as possible so that they have money to cover their needs.
Cristóbal Buendía, attorney for the Federation of Public and Private Workers , also considers that due to the urgency it is logical to use these funds to provide resources to the unemployed.
For the workers’ representative, giving resources to citizens will help the economic reactivation because it will allow consumption , which generates demand, supply and employment . “The blood of the economy is the circulation of money,” he says.
However, Buendía believes that this measure should be temporary because the resources may not reach the number of requirements that could exist. “If many people withdraw the money at the same time, this fund could be lost due to lack of financing, ” he says.
Villacrés and Buendía clarify that the use of the resources accumulated in the Unemployment Insurance does not affect the solvency of the IESS because the accounts of the two funds and of the five insurances that exist are managed individually, each with its own source and destination.
Labor expert Modesto Apolo is not in favor of this proposal due to the critical situation of the IESS. He believes that rather it should be aimed at strategies to expand the working mass.
Considers it important to provide facilities for investors to generate work; and recommends that the mixed salary be applied , which consists of a fixed minimum base plus a percentage for productivity.