Is extra $300 in federal unemployment assistance stopping people from applying for jobs?

With about 56,000 people in Allegheny and Westmoreland counties reporting they are without a job, businesses still find themselves scrambling to fill vacancies.

One reason cited for the challenge is the extra $300 a week in federal Pandemic Emergency Unemployment Assistance that people have collected since the end of December. That supplement is half of what was provided through the first covid relief bill.

To Gene Barr, president of the Pennsylvania Chamber of Business and Industry, the extra jobless benefits is a factor keeping workers from taking jobs. One recent report estimated 25% of unemployed people are making more in benefits than when working, Barr said.

“How do you compete with the federal government? You can’t,” said Barr, who suggested the state should take that extra $300 and offer it to jobless workers as a one-time bonus for returning to work.

Workers are staying home and collecting money rather than a paycheck, said Barney Oursler, executive director of the Mon Valley Unemployed Committee.

“The unemployment compensation pays only half of what they were making in wages,” Oursler said.

Factors such as the availability of child care, concerns over becoming ill with covid and spreading it to family along with job location play a much bigger role in whether unemployed people apply for jobs, Oursler said.

From Kelli Prucnal’s perspective, whose Carol Harris Staffing tries to attract workers for clients, the extra unemployment benefits and the stimulus checks challenge recruiting efforts.

“When the unemployment and the stimulus checks die down, I think people are going to start looking again,” Prucnal said.

Chris Briem, a regional economist at the Center for Social & Urban Research at the University of Pittsburgh, disagrees that the extra unemployment compensation is keeping people from work.

“It has had a marginal impact,” he said.

Turnover is a natural force in the restaurant industry, which can see a workforce change of about 70% a year, Briem said. With more restaurants expanding service with the lifting of restrictions, “it’s impossible” for all restaurants to hire at once, Briem said.

The extra jobless benefits is one piece of what Ben Fileccia, director of operations and strategy for the Pennsylvania Restaurant and Lodging Association, describes as “a complicated issue.”

Having access to reliable child care is one element holding workers back, Fileccia said.

In addition, the Pittsburgh region has seen a shrinking labor force, Briem said. There are about 46,000 fewer workers in the region compared to a year ago, he said. Some dropped out to take care of family members; some took early retirements; others, like students, went home during the pandemic and may never have returned.

While some businesses blame stimulus checks and extra unemployment cash for encouraging people to stay home, Abby Wolensky, deputy director of the Employment Institute in McKeesport, said it’s not always that simple. Auberle, which operates the employment institute, often works with people facing significant barriers to their workplace success — factors such as homelessness or behavioral and mental health issues.

Those individuals may need additional resources — like those provided by the Employment Institute — to prepare themselves for a job. Employers, Wolensky said, need to understand the struggles some employees may be facing — particularly those who have been impacted by the pandemic.

To give workers more of an incentive to look for jobs and make unemployment compensation less lucrative, Republican governors in Alabama, Arkansas, Iowa, Montana, North Dakota, Mississippi, South Carolina and Tennessee have eliminated the $300 extra jobless pay, as of various dates in June or July.

In Pennsylvania, Wolf shows no inclination to follow suit.

“There is no evidence to support the false narrative that additional unemployment benefits are a primary factor in the perceived labor shortage,” said Lyndsay Kensinger, the governor’s spokeswoman. “Pennsylvanians who are ready to return to the workforce are already being enticed to certain employers or industries who are offering higher wages, signing bonuses and other contributions.”

Author: Julia FeltonPublication: TribLIVE