Arizona Governor Doug Ducey speaks to reporters after meeting then-President Donald Trump at the White House on April 3, 2019.
Chip Somodevilla | Getty Images
States are withdrawing two or more months before their scheduled September 6 end date. Officials claim the added benefits keep workers on the sidelines, making it harder for companies to hire employees.
Four of the states – Arizona, Montana, New Hampshire, and Oklahoma – are paying return to work bonuses in lieu of increased unemployment benefits to encourage residents to take jobs.
“In Arizona, we’re going to be using federal funds to encourage people to work instead of paying people to not work,” said Governor Doug Ducey last week.
The government’s Back to Work program provides one-time payments of $ 1,000 for unemployed people taking part-time jobs and $ 2,000 for full-time workers.
New Hampshire pays $ 500 and $ 1,000 in bonuses for part-time and full-time positions through its Summer Scholarship Program. Montana and Oklahoma pay $ 1,200 to those who take on full-time work.
However, some economists don’t believe that unemployment benefits play a huge role in hiring people.
“I think it’s a gamble for states to assume that expanded unemployment insurance is the only reason they’re having trouble getting on,” said AnnElizabeth Konkel, an economist on site.
“I think it does matter, but it’s impossible to quantify how much and I don’t think that’s the only reason,” she added.
Instead, many economists believe the ongoing pandemic is likely the driving force.
Covid started this whole mess so you can’t discount it until we’re 100% back to normal.
Economist at Indeed
Covid infections are decreasing, but remain increased. According to the Johns Hopkins University, the 7-day average of new infections on Thursday was 29,100.
According to the Centers for Disease Control and Prevention, only 48% of adults are fully vaccinated. Those who have not completed the full vaccination regimen may be reluctant to return to work given the ongoing health risk.
“Covid created this whole mess, so you can’t discount it until we’re 100% back to normal,” said Konkel.
And there are other pandemic-related factors, like childcare if schools don’t fully reopen or daycare centers stay closed. There is also generally a lag between demand for labor (vacancies) and supply (available labor).
A single mother with childcare issues or someone who is afraid or exposed to the coronavirus may be reluctant to return to work even if a bonus is available, Konkel said. However, such a bonus could be significant for the unemployed when money is a main motivator, she added.
There are also caveats related to the return-to-work bonuses that limit their availability.
For example, workers in New Hampshire and Arizona are eligible only if their new jobs pay less than $ 25 an hour (equivalent to an annual salary of $ 52,000). Depending on the federal state, employees have to complete four to ten consecutive working weeks in order to qualify. Those in Montana and Oklahoma may also be able to find only part-time jobs instead of full-time jobs, which would likely exclude them from a bonus.
Workers must also apply for the bonus. Funds are available based on availability due to limited funding. In Oklahoma, for example, it is available to the first 20,000 qualified residents.