The US Chamber of Commerce is calling for Washington to immediately stop paying out-of-work Americans an extra $300 a week in unemployment benefits, citing the disappointing jobs report.
“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 in a statement on Friday.
“One step policymakers should take now is ending the $300 weekly supplemental unemployment benefit. Based on the Chamber’s analysis, the $300 benefit results in approximately one in four recipients taking home more in unemployment than they earned working.”
The statement follows the release of the Labor Department’s jobs report for April that shows only 266,000 jobs were added, with the unemployment rate rising from 6.0 percent to 6.1 percent amid an escalating shortage of available workers.
CNBC News is reporting that Dow Jones estimates had been for 1 million new jobs and an unemployment rate of 5.8 percent. The economy is still 8.2 million jobs short of its February 2020 pre-pandemic levels.
NBC News is reporting there may be several factors holding back the return of people to the workplace. Some low-income workers may be reluctant to look for work because they are receiving a federal boost in aid, on top of state benefits, meaning they are getting more money by staying home.
There are other factors that may be keeping people from returning to work, including te fear of contracting the coronavirus, or because they need to care for children who haven’t returned to school.
The US Chamber of Commerce’s support came about after Montana and South Carolina announced plans this week to eliminate their federal jobless benefits starting next month. Montana plans to cancel those same benefits and programs on June 27.
“This labor shortage is being created in large part by the supplemental unemployment payments that the federal government provides claimants on top of their state unemployment benefits,” South Carolina Gov. Henry McMaster said in a statement on Thursday.
“What was intended to be a short-term financial assistance for the vulnerable and displaced during the height of the pandemic has turned into a dangerous federal entitlement, incentivizing and paying workers to stay at home rather than encouraging them to return to the workplace.”
