Five Republican governors are turning down the $300 in enhanced unemployment benefits that are part of President Biden’s coronavirus relief plan to encourage their jobless workers to return to work.
Arkansas Gov. Asa Hutchinson said the expanded jobless benefits were helpful to states when unemployment rates were running sky high during the worst of the coronavirus pandemic last year.
“But now our economy has come back, we have jobs aplenty, we have employers that are begging workers to come to their place of business,” he said Tuesday on CNN’s “New Day.”
“We cannot pay extra compensations for workers to stay home — we need them in the place of employment,” he said, adding, ”If they need assistance in finding a job, we’ll provide that to them. If they need child care assistance, we have more than ample resources to assist in that, as well.”
Hutchinson, who’s pulling out of the supplemental benefits on June 26, said the added benefits were “simply an impediment” to Arkansas residents who want to work.
He’s among a quintet of governors — including Tate Reeves of Mississippi, Greg Gianforte of Montana, Henry McMaster of South Carolina and Kay Ivey of Alabama — who have come to similar conclusions.
In a Twitter post on Monday, Reeves’ comments about the jobless benefits echoed Hutchinson’s.
After talking with small business owners and their employees, he said, it “became clear” that the expanded benefits “may have been necessary in May of last year but are no longer so in May of this year.”
He said Mississippi will opt out beginning on June 12.
“It has become clear to me that we cannot have a full economic recovery until we get the thousands of available jobs in our state filled,” he said in the posting.
The 266,000 jobs created in April, which came in well below expectations of 1 million, pushed up the unemployment rate to 6.1 percent and caused Biden administration officials and economists across the country to fear that an economic rebound from the pandemic was stalling.
It was especially troublesome after March’s strong report that saw 777,000 jobs added.
Republicans blamed the jobless benefits making it more lucrative for the unemployed to stay home rather than return to work.
They pointed to economists at Bank of America who said that the combined unemployment benefits meant that anyone earning less than $32,000 a year can potentially receive more income from unemployment aid than from their previous jobs.
Jobless Americans are getting an extra $300 a week in federal benefits through Labor Day — on top of state unemployment benefits averaging about $320 per week.
Combining state and federal unemployment payments comes out to an average of $638 a week.
The payout had been $938 in April 2020, when the Trump administration passed a temporary plan during the height of the pandemic that boosted weekly unemployment payments by $600 and also gave one-shot stimulus checks.
That ran out in July and the unemployment boost was cut to $300 a week, which runs through Sept. 6.
As the criticism mounted and business owners complained they couldn’t find enough workers, Biden spoke Monday to address the situation, warning people to take a job if offered or lose their benefits.
“The law is clear: If you’re receiving unemployment benefits and you’re offered a suitable job, you can’t refuse that job and just keep getting the unemployment benefits,” Biden said at the White House.
“No one should be allowed to game the system and we will insist that the law is followed,” the president said.
McMaster of South Carolina also decried the incentives and said they are putting the US “right on the road to socialism.”
He’s ending the benefits on June 30.
“This is about as close to socialism that I’ve seen,” the Republican told Tucker Carlson on Fox News Monday night.
“We’ve got Help Wanted signs up everywhere, we get calls and letters, and texts from all sorts of businesses all across the state looking for people to work,” McMaster said.
“People won’t come to work because they’re getting as much money or more in some cases by staying home.”
Ivey announced on Monday that Alabama was ending its participation in the program on June 19.
“As Alabama’s economy continues its recovery, we are hearing from more and more business owners and employers that it is increasingly difficult to find workers to fill available jobs, even though job openings are abundant,” she said in a statement.
“Among other factors, increased unemployment assistance, which was meant to be a short-term relief program during emergency-related shutdowns, is now contributing to a labor shortage that is compromising the continuation of our economic recovery,” she said.
She said the state’s Department of Labor was reporting that there are “more jobs now than prior to the pandemic,” noting the state’s jobless rate was 3.8 percent.
Gianforte was among the first to say he would end the benefits at the end of June.
Instead of the supplemental payments, he said, Montana would pay $1,200 “return-to-work” bonuses to the unemployed if they rejoin the labor force and maintain steady employment for at least a month.
“Montana is open for business again, but I hear from too many employers throughout our state who can’t find workers. Nearly every sector in our economy faces a labor shortage,” Gianforte said in a statement last Tuesday.
“Incentives matter, and the vast expansion of federal unemployment benefits is now doing more harm than good. We need to incentivize Montanans to re-enter the workforce,” he said. “Our return-to-work bonus and the return to pre-pandemic unemployment programs will help get more Montanans back to work.”