The U.S. Chamber of Commerce is calling for Washington to immediately stop paying out-of-work Americans an extra $300 a week in unemployment benefits, saying the boost in government aid is giving some recipients less incentive to look for work.
The business group said Friday that the supplemental unemployment benefit, part of the Biden administration's efforts to support the pandemic-ravaged economy through September, results in about one in four recipients taking home more in unemployment pay than they earned when they were working.
The statement follows the release of surprisingly weak jobs data for April. On Friday, the Labor Department said U.S. employers added just 266,000 jobs last month, a big drop from March and well below the nearly 1 million jobs economists were expecting, according to FactSet.
"The disappointing jobs report makes it clear that paying people not to work is dampening what should be a stronger jobs market," said Neil Bradley, the Chamber's executive vice president and chief policy officer. "We need a comprehensive approach to dealing with our workforce issues and the very real threat unfilled positions poses to our economic recovery from the pandemic."
U.S. companies have added jobs for four straight months, but some employers complain that they can't find workers, despite an elevated unemployment rate.
In Tennessee, the state's career centers listed 248,086 open jobs on Friday, or 48% more jobs than the total number of unemployed persons looking for work in the Volunteer State last month.
For workers who are still drawing unemployment benefits in Tennessee, the state's unemployment insurance program pays up to $275 a week and the federal government's $300 weekly supplement raises that payment up to $675 a week. For those working a 40-hour workweek, the jobless benefits will exceed what a person makes on the job if a worker is paid less than $16.88 an hour.
"As President Reagan's chief economist Arthur Laffer used to say, "If you pay people not to work and you tax people who do work, don't be surprised if lots of people are not working," said U.S. Rep. Mark Green, R-Tennessee.
Green said a Black-owned smamll buisnessperson making wigs in Memphis told him he lost 30 employees in one day when the latest stimulus checks were mailed out.
"Businesses and restaurants are closing, not because of COVID and not because there isn't demand for their services, but because they can't compete with the government paying people not to work," Green said.
But some of the reason for the increase in the unemployment rate reflects more people coming back into the workforce, according to the U.S. Department of Labor. As more people have begun looking for work, more are being counted among the jobless: The unemployment rate ticked up in April to 6.1% from 6% in March.
While 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, other factors may be keeping some Americans from returning to work, including fear of contracting the coronavirus or because they need to care for children who haven't returned to school.
— Compiled by Dave Flessner