There are plenty of anecdotal examples to back up each page. But what’s happening in the labor market right now – and the impact of the controversial weekly federal hike of $ 300 that Congress extended in its latest stimulus package in March – remains unclear.
According to a survey by the Initiative on Global Markets at the University of Chicago’s Booth School of Business, about half of economists say they aren’t sure whether the low-wage supplement is a big deterrent. Around 28% believe it does, while 16% think it does not.
The $ 300 boost, plus two other pandemic programs that benefit independent contractors and others who typically don’t qualify, as well as those who have run out of regular government benefits, are slated to last through early September in the states that put the programs in place away.
It is known that the additional federal payment means that some people earn more with unemployment than with their work. It is estimated that around 25% to around 40% of laid-off workers find themselves in this situation.
What the unemployed say
Although there were a record 8.1 million job openings in March, some workers say many of these positions are underpaid, too far away to be affordable, or that the job openings require skills or certifications they don’t have.
And yet others still struggle to ensure full-time childcare because their providers may be closed or with limited registration, or because their children are still attending school remotely.
Also, despite the increase in vaccinations and the decrease in cases, the pandemic continues to weigh on some Americans. About 3.8 million people said they weren’t working because they were concerned about getting or spreading the virus – up from 4.2 million in April, according to the Census Bureau.
What companies say
Employers eager to hire when the economy reopens say they can’t find enough workforce – in part because the generous allowance keeps people on the sidelines.
“It is not the Reason, but it absolutely is a Reason, “said Neil Bradley, chief policy officer of the US Chamber of Commerce, which has urged states to end the pandemic program.
There’s already some early evidence that the impending end of the supplement is having an intended effect, Bradley told CNN. He referred to a report by Indeed which showed that job search activity on the site had increased the day a state announced it would end its pandemic benefits early. However, the bump disappeared on the eighth day.
According to a recent study by the Federal Reserve Bank of San Francisco, the $ 300 weekly supplement likely had “small but noticeable effects” on job search and labor availability for the first four months of this year.
About 1 in 7 workers don’t take jobs because of the improvement, according to study co-author Rob Valletta, assistant director of research at the San Francisco Fed.
The result is an extrapolation from previous research into last year’s $ 600 increase. But ending the current supplement is unlikely to help employers much, Valletta told CNN.
“The abolition will not increase employment growth much,” he said of the $ 300 increase.
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