WORLD / AMERICAS
Citing labor shortage, US states end pandemic jobless benefits, funds
Citing labor shortage, US states end pandemic jobless benefits
Published: May 12, 2021 08:03 PM
A handful of US states have announced they will end extra unemployment benefits provided by the federal government, which they blame for creating a shortage of workers.

US President Joe Biden delivers remarks on the economy in the East Room of the White House on May 10, 2021 in Washington DC, the US. Photo: VCG

US President Joe Biden delivers remarks on the economy in the East Room of the White House on Monday in Washington DC, the US. Photo: VCG

Iowa on Tuesday joined Alabama, Arkansas, Mississippi, Montana and South Carolina in cutting off the payments that through September are providing $300 a week on top of regular state benefits. But President Joe Biden pushed back against the argument that the extra payments - funded by the $1.9 trillion rescue package Congress approved in March - mean "people are being paid to stay home rather than go to work."

The moves in the Republican-led states came after a disappointing employment report released on Friday, which showed the US economy recovered just 266,000 positions in April, far short of the expected gain of 1 million positions. The data show the economy still has not recovered 8.2 million of the 22 million jobs lost during the COVID-19 pandemic.

Some employers and the US Chamber of Commerce blame the sluggish hiring in part on the generous jobless benefits.

"It's time for everyone who can to get back to work," Iowa Governor Kim Reynolds tweeted on Tuesday, saying her state would end its participation in all federal pandemic-related unemployment benefit programs. 

"Our unemployment rate is at 3.7 percent, vaccines are available to anyone who wants one and we have more jobs available than unemployed people," she said.

Some states also cut off the special federal program that provided funds to help freelance and gig workers, such as those employed by ride hailing services, who do not qualify for regular unemployment benefits.

Montana recently reacted to its labor shortage by launching a "return-to-work bonus" that would pay $1,200 to workers who accept a job and get off unemployment.

In Mississippi, Governor Tate Reeves said he had spoken to many small business owners and found the special programs "that may have been necessary in May of last year are no longer so in May of this year."
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