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Earlier this year, an incendiary cry erupted from business leaders and Republican governors: cut the $300-a-week federal supplement for unemployed Americans. Many, he argued, would then come off the edge and take on the millions of jobs that employers were desperate to fill.


Yet three months after half the states ended that federal payment, there has been no significant influx of job seekers.

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In states that cut the $300 check, the workforce—the number of people who either have a job or are looking for one—has grown no more than in states that keep paying. That federal aid, along with two jobless assistance programs that served gig workers and the long-time unemployed, ended nationally on September 6. Yet America’s overall workforce actually decreased that month.

“Policy makers were placing high hopes on unemployment insurance to boost the labor market,” said Fiona Gregg, managing director of the JPMorgan Chase Institute, which used JPMorgan bank account data to study the issue. “Task discouragement effects were apparently small.”

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The labor shortage has persisted longer than many economists expected, deepening a mystery at the heart of the job market. Companies are eager to add workers and have posted an almost record number of jobs available. Unemployment remains high. There are still 5 million fewer jobs in the economy than before the pandemic. Yet job growth slowed in August and September.

An analysis of state-by-state data by the Associated Press found that workers in 25 states who retained pay of $300 actually increased slightly from May to September, according to data released Friday. Payments quicker than cut states, most of them in June. A $300-a-week federal check on top of regular state jobless aid meant that many unemployed received more benefits than they earned at their old jobs.

An earlier study by Arindrajit Dubey, an economist at the University of Massachusetts, Amherst, and several colleagues found that states that cut federal payments of $300 saw a marginal increase in the number of unemployed. But it was also found that it did not shore up more people in search of work.

Economists point to a number of factors that are preventing millions of former recipients of federal jobless aid from returning to the workforce. For example, many Americans in public-facing jobs still fear contracting COVID-19. Some families lack child care.

Others, like Rachel Montgomery of Anderson, Indiana, have grown to cherish the opportunity to spend more time with their families and feel they can get by financially, at least for now. Montgomery, a 37-year-old mother, said she has become “pickier” about where she is willing to work after she lost her catering job last year. Missing the $300-per-week federal payment hasn’t changed his mind. She will receive her regular state jobless assistance for a few more weeks.

“Once you’re at home with your kids and family like this, who wants to physically go back to work?” he said. “As I look and see, I’ve told myself that I’m not going to sacrifice the pay or flexibility of working remotely when I know I’m qualified to do certain things. But It also means it’s going to take longer to find those types of jobs.”

In fact, the pandemic has led to a re-evaluation of priorities, with some deciding to spend more time with family and others insisting on working remotely or getting more flexible hours.

Some former recipients, especially older, more affluent people, have decided to retire earlier than their plan. With Americans’ overall home values ​​and stock portfolios rising since the pandemic, Fed officials estimate that 2 million more people have retired since then than otherwise would have been.

And after receiving three stimulus checks in 18 months, as well as federal jobless aid in some cases, most families have a bigger cash cushion than they did before the pandemic. A study by Greg and his colleagues at JPMorgan found that the average bank balance for the poorest one-quarter of households has jumped 70% since COVID hit. The result is that some people are taking the time to consider their options before returning to the job market.

Graham Berryman, 44, a Springfield, Missouri resident, has been saving since Missouri cut $300-a-week federal jobless payments in June. He has had the temporary job of reviewing documents for law firms in the past. But they have not received anything permanent since August 2020.

“I’m not lazy,” said Berryman. “I’m unemployed. It doesn’t mean I’m lazy. Just because someone can’t find suitable work in their profession, doesn’t mean they should be thrown out.”

Similarly, some couples have decided that they can get by with only one income instead of two, at least temporarily.

Sarah Hamby of Kokomo, Indiana, lost her $300-a-week federal pay this summer when Gov. Eric Holcomb, a Republican, ended that gain early. Hamby’s husband, who is 65, has kept his job working overnight at a printing press during the pandemic. But he can decide to join the category of people who retire before the scheme.

And if 51-year-old Hamby doesn’t find work soon enough, she can do it herself. The jobs they had for decades in auto factories have largely disappeared. The positions she sees available now require skills she doesn’t have. Yet he is not just looking for a job.

“I’m at a point where I feel like I’m too old and not educated or trained to do other types of work,” she said. “And to be honest, I don’t want to work in the office, on the computer, like a lot of us are being prompted to do. So now I’m stuck between doing something that pays very little. does it for what it’s worth – or is too physically demanding – or I just don’t work out.”

Nationally, the proportion of women either working or looking for work fell for the second month in a row in September, evidence that many parents – mostly mothers – are still seeking their childcare to return to work. Unable to manage duties. Childcare centers have reduced staffing, reducing the care available. And while schools have reopened for in-person learning, repeated closures due to the COVID outbreak have been disruptive to some working parents.

Further exacerbating the labor shortage, a record number of people left their jobs in August, in some cases due to the prospect of higher wages elsewhere.

In Missouri, a group of businesses, still reeling from labor shortages more than three months after the state cut a $300-a-week federal jobless check, paid for billboards in Springfield, in which Was told: “Get off your butt!” and “Get. To. Work.”

The state has not seen any increase in its workforce since ending emergency benefits.

“We don’t know where the people are,” said Brad Parke, general manager of Greek Corner Screen Printing & Embroidery. “Obviously, they’re not at work. Apparently, they’re at home.”

Richard von Glenn, policy director for Missouri Jobs With Justice, an advocacy group, suggested that many people in the job market want more benefits or flexibility to care for children.

“People don’t want to go back” to the pre-pandemic job market, Vaughan Glen said. “Employers have a role to play in creating a work environment and offering a package that gives workers the protection they need.”

In Wyoming, fewer people are now in the workforce than when the state cut all emergency jobless aid. Fear of contracting COVID-19 discouraged some from looking for jobs, Wenlin Liu, chief economist at the state economic analysis division, said last week.

Wyoming has one of the lowest vaccination rates in the country, he noted, and has been a COVID-19 hotspot since late summer. The rise in infections, Liu said, may have led some parents to keep their children at home.

State Representative Landon Brown, a Republican, defended the cutoff for federal unemployment aid.

“Wyoming,” Brown said, “is not interested in continuing to allow the federal government to take people off jobs, paying them as much to stay home and get jobs in some cases.”

Mississippi ended all emergency jobless aid on June 12. Yet fewer people were working in it in August than in May. Last week in Tupelo, a job fair attracted 60 companies, including a recruiter from VT Halter Marine, a shipbuilder based 300 miles south. About 150 to 200 job seekers also participated, less than expected in some occupations.

Adam Todd organized a job fair for the Mississippi Department of Employment Security, which helps people find jobs and distribute unemployment benefits. The agency has received “calls of desperation,” Todd said, “from businesses that need to recruit workers during the pandemic.

“We’ve been in different times for a very long time,” Todd said. “The job seeker is truly in the driver’s seat right now.”


Smith is a core member for the Associated Press/Report for America Statehouse News Initiative. Report for America is a non-profit national service program that places journalists in local newsrooms to report on secret issues.


Ragber reported from Arlington, Virginia. AP Writers Emily Vagster Pettus in Jackson, Mississippi, Mead Gruver in Cheyenne, Wyoming and Summer Ballantyne in Jefferson City, Missouri contributed to this report.