A growing number of Republican governors will end state participation in pandemic-era federal unemployment programs amid concerns over a nationwide labor shortage.
The Biden administration extended the federal unemployment benefits to an additional $300 per week through Sept. 6, an effort to ease the transition as the economy slowly reopens.
In early May, Gov. Greg Gianforte (R-MT) made Montana the first state to announce their withdrawal from the program, saying the extra federal unemployment benefits were “doing more harm than good” and preventing potential employees from returning to work. Beginning June 27, unemployed workers in the state will no longer receive the $300 in weekly extra benefits. Instead, the state will launch a new program incentivizing unemployed workers who return to work by giving them a one-time $1,200 bonus after they have completed four weeks in their new jobs.
Days after Gianforte’s announcement, South Carolina’s Republican Gov. Henry McMaster said the state would make a similar move to leave the federal unemployment programs, citing an “unprecedented” workforce shortage across the state. The state will opt out of the coronavirus pandemic assistance programs beginning June 30.
A startlingly weak jobs report for April, which was released last Friday by the Bureau of Labor Statistics, only served to buoy these concerns. The jobs report fell far short of the expectations of economists, many of whom predicted the country would add as many as 1 million jobs. But the economy added only 266,000 jobs last month, despite reporting an increase of 916,000 in March and 468,000 in February.
Hours after the report was released, Arkansas’ Republican Gov. Asa Hutchinson directed the Division of Workforce Services to end the state’s participation in the enhanced unemployment benefits program after June 26.
Just this week, the GOP governors of Alabama, Iowa, Mississippi and Missouri announced they would similarly end their states’ participation in the program, all citing concerns over labor shortages.