The enhanced unemployment benefits from the last federal relief package run through September, but if you’re unlucky enough to be an unemployed person living in some states run by Republicans, you’re already losing money.
The governors of Alaska, Iowa, Missouri, and Mississippi all voluntarily ended their states’ enhanced benefits over the weekend, the first of 25 states that plan to end participation in the federal programs, as Reuters reported earlier this month. Currently, the federal benefits account for an extra $300 per week, a lifeline for unemployed workers during the COVID-19 pandemic. There are nearly 3 million people receiving the enhanced benefits in the 25 states ending the programs, according to Reuters.
The states that are opting out of the program claim the enhanced unemployment benefits, which were first included in the CARES Act signed by former President Donald Trump last year, are disincentivizing people from returning to work. The U.S. Chamber of Commerce, the main lobbying arm of American business, has also urged Congress to kill the benefits early.
This argument relies on company-driven narratives about how people “don’t want to work anymore,” but there’s no evidence to support that claim. As the left-leaning Economic Policy Institute pointed out last month, when states announced they’d slash unemployment benefits, the unemployment rates in nearly all those states were still lagging behind pre-pandemic lows.
Though the federal April and May jobs reports came in below expectations, there’s no evidence to indicate that the extra unemployment benefits are the reason why. Rather, a tight labor market has forced companies to compete with each other by raising wages and offering other incentives such as signing bonuses; burrito chain Chipotle said last month it would raise average wages to $15 per hour, and last month a Pittsburgh-based ice cream parlor said it was inundated with applications after raising its wage to $15 per hour.
The other states will end their participation within the next month. “While these federal programs provided important temporary relief, vaccines and jobs are now in good supply,” Maryland Gov. Larry Hogan, a Republican, said in a statement earlier this month announcing the end of benefits beginning July 3.
“And we have a critical problem where businesses across our state are trying to hire more people, but many are facing severe worker shortages. After 12 consecutive months of job growth, we look forward to getting more Marylanders back to work.”
While the Biden administration has rejected enhanced unemployment benefits as the driver of corporate America’s hiring woes, President Joe Biden said last month that Americans receiving benefits must accept “suitable employment” if it’s offered to them. Biden also indicated earlier this month that he doesn’t plan to push for an extension of unemployment benefits beyond September 14, when they end under the American Rescue Plan he signed earlier this year.
In Missouri, one of the states that already abandoned the enhanced benefits, demonstrators gathered in Springfield over the weekend to protest the move.
“This kind of thing happens over and over again because we put the profits of businesses before people’s needs,” protester Alice Barber told KY3. “We’re not taking care of one another, and not taking care of our neighbors, even as we’re coming through a pandemic that isn’t really over.”