HomeMarket NewsCalifornia Governor Newsom Rejects Unemployment Pay for Striking Workers

California Governor Newsom Rejects Unemployment Pay for Striking Workers

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California Governor Gavin Newsom has vetoed a bill that would have provided unemployment payments to workers who participated in strikes lasting more than two weeks. Governor Newsom cited concerns about the state’s increasing debt and the financial burden the benefits program would impose.

In a message explaining his decision, Governor Newsom emphasized the need to control costs and avoid further debt for the unemployment fund. The fund already carries a debt of nearly $20 billion, with the state paying significant amounts in interest on a federal unemployment insurance loan. An additional $302 million was due in September.

The bill was originally passed by California’s legislature in September, during a period when Hollywood actors and writers were on strike. While writers have since returned to work and have until October 9 to vote on a proposed contract, hotel workers in Southern California continue to be on the picket lines.

It’s worth noting that, unlike New York and New Jersey, most states in the U.S. do not offer unemployment benefits to workers on strike.

In addition to his recent actions regarding unemployment pay for striking workers, Governor Newsom holds the authority to select a successor to the late Senator Dianne Feinstein.

Frequently Asked Questions

  • Why did Governor Newsom veto the bill for unemployment pay to striking workers?
  • How much debt does California’s unemployment fund currently have?
  • Which states in the U.S. provide unemployment benefits to workers on strike?

The Pros and Cons of Offering Unemployment Pay to Striking Workers


  • Provides financial support and stability to workers during strikes
  • Encourages workers to exercise their right to collective bargaining
  • Helps maintain a strong labor movement


  • Increases financial burden and debt for the unemployment fund
  • Potentially encourages more frequent or prolonged strikes
  • Can strain labor relations and hinder negotiation processes

Myth vs. Fact: Unemployment Pay for Striking Workers

Myth: Offering unemployment pay to striking workers is unfair to taxpayers.

Fact: Unemployment benefits are funded by employer-paid taxes, not taxpayer dollars directly, making it a separate financial system.

Expert Advice: How Strikes and Unemployment Pay Affect Financial Markets

Investors and traders closely monitor strikes and their impact on financial markets. Strikes have the potential to disrupt operations and affect companies’ financial performance, which can influence stock prices and market sentiment. The availability or absence of unemployment pay for striking workers can also have implications for labor relations and the overall economy.

When considering investment decisions during strikes, it’s important to evaluate the specific industries and companies involved, assess potential risks, and stay updated on the progress of negotiations. Keeping a pulse on labor relations and the possible outcomes of strikes can help investors make informed decisions in volatile market conditions.

Ultimately, strikes and unemployment pay are factors to consider when analyzing the potential impact on financial markets and individual investments.


California Governor Gavin Newsom’s rejection of unemployment pay for striking workers highlights the state’s concerns about increasing debt and the financial burden on its unemployment fund. As investors and traders, it’s important to monitor labor relations and the outcomes of strikes, as they can have implications for financial markets and individual investments.

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