The owners of several types of businesses, including recreational destinations and restaurants, are worried they will suffer enduring labor shortages throughout the summer thanks to extended unemployment benefits contained in Democratic COVID relief measures signed in recent weeks by President Joe Biden.
Some of the worst-hit businesses have been restaurants, with many owners directly blaming their shortage of staff on enhanced unemployment benefit payments contained in Biden’s $1.9 trillion American Rescue Plan, payments that have been extended through September, Just the News reported Monday.
The large stimulus package was passed in March and included weekly payments of an additional $300 on top of benefits paid for by state unemployment agencies. Democrats passed the measure using the budget reconciliation process because they could not get a single Republican lawmaker to go along with it.
Still, some GOP governors have taken measures to help business owners that are already showing positive results: They have voluntarily moved to reject the enhanced federal unemployment payments because of the sustained labor shortages.
At least 25 governors have done so, including two Democrats from Massachusetts and Vermont, CNBC reported, noting last week that Maryland’s GOP Gov. Larry Hogan became the latest to withdraw from the program. The financial news outlet listed the other states that have withdrawn as well: Alabama, Alaska, Arizona, Arkansas, Florida, Georgia, Idaho, Indiana, Iowa, Mississippi, Missouri, Montana, Nebraska, New Hampshire, North Dakota, Ohio, Oklahoma, South Carolina, South Dakota, Tennessee, Texas, Utah, West Virginia and Wyoming.
“While these federal programs provided important temporary relief, vaccines and jobs are now in good supply. And we have a critical problem where businesses across our state are trying to hire more people, but many are facing severe worker shortages,” Hogan said, echoing a familiar refrain from employers.
Most of the decisions to end the enhanced benefits came after a pathetic April jobs report; unemployment fell by just 266,000 after most economists had predicted at least 1 million jobs would be filled.
“The disappointing jobs report makes it clear that paying people not to work is dampening what should be a stronger jobs market,” U.S. Chamber of Commerce chief policy officer Neil Bradley said at the time.’
Labor analysts said other factors are also at play that are preventing some Americans from returning to the workforce, including the inability to find childcare so they can go back to work after being at home for months or longer due to pandemic-related closures.
But regardless of the reasons, employers around the country are getting desperate to hire enough staffers to reopen their doors and remain open, and that includes several vacation destinations.
“In Virginia, the theme park Kings Dominion reported that it did not have enough workers for the summer, despite raising its starting wage for park employees to $13 per hour. Kings Dominion and Busch Gardens are reducing park hours for patrons as a result of the worker shortage,” Just the News reported.
Universal Studios in Orlando, meanwhile, has boosted its starting wage to $15 per hour as a way of enticing people to take jobs as the summer approaches.
Locally, community parks and swimming pools are also having trouble finding lifeguards and other staff so they can open and safely operate.
“You have people on unemployment insurance who are getting the additional $300 on top of the state benefit – in Ohio the average is $360 plus $300, so $660 a week – plus the first $10,000 is not taxed,” Sen. Rob Portman (R-Ohio) said last month.
“So if you’re a truck driver making $40,000 a year, you’re being taxed, but if you’re on unemployment insurance, your first $10,000 of UI is not being taxed. How is that fair?”
He added: “Well, it creates an additional disincentive to go to work. So I’m not saying it’s the only reason people aren’t going back to work, but if you talk to the small business folks in your state, you will find it’s one of the big reasons.”
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