Citing labour shortage, US states end pandemic jobless benefits

WASHINGTON (AFP) – A handful of United States (US) states have announced they will end extra unemployment benefits provided by the federal government, which they blame for creating a shortage of workers.

Iowa on Tuesday joined Alabama, Arkansas, Mississippi, Montana and South Carolina in cutting off the payments that through September are providing USD300 a week on top of regular state benefits.

But US President Joe Biden pushed back against the argument that the extra payments – funded by the USD1.9 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 last week, which showed the US economy recovered just 266,000 positions last month, far short of the expected gain of one 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 programmes.

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

A hiring sign offering a USD500 bonus outside a McDonalds restaurant, in Cranberry Township, Butler County, Pennsylvania. PHOTO: AP