First four states cut off federal unemployment benefits
Alaska, Iowa, Missouri and Mississippi eliminated their federal unemployment programs on Saturday, ending federal assistance for almost 340,000 workers.
The states are the first four of the 25 Republican-led states that have announced plans to end federal assistance to do so.
“As Alaska’s economy opens up, employers are posting a wide range of job opportunities and workers are needed,” Alaska Department of Labor and Workforce Development Commissioner Tamika Ledbetter said in a statement.
In March 2020, Congress passed the Coronavirus Aid, Relief and Economic Security Act, which provided an addition $600 weekly checks from the federal government to people who were unemployed, in addition to benefits they were already receiving from their state. That unemployment aid was later dropped to $300 a week and extended through September 2021.
Republican state leaders have argued they need to end the enhanced unemployment benefits because they provide an incentive for people to stay unemployed rather than returning to the work force. They say the benefits drive up wages, stifle hiring and squeeze small businesses.
Democrats and a number of economists, however, push back against those claims. Unemployment benefits have little effect, they say, and the slow return of people to the workforce is actually driven by a lack of child care and lingering health concerns.
Though May saw a gain of 559,000 new jobs, it came after a disappointing jobs report in April showed that only 266,000 jobs had been added.
“It has become clear to me that we cannot have a full economic recovery until we get the thousands of available jobs in our state filled,” Mississippi Tate Reeves (R) said in a statement.
According to CNBC, these are the states that will be opting out: Alabama, Alaska, Arizona, Arkansas, Florida, Georgia, Idaho, Indiana, Iowa, Maryland, Mississippi, Missouri, Montana, Nebraska, New Hampshire, North Dakota, Ohio, Oklahoma, South Carolina, South Dakota, Tennessee, Texas, Utah, West Virginia and Wyoming.