Expanded Unemployment Benefits Continue to Undermine Hiring In Ohio

May 27, 2021 | Portman Difference

With the economy heating up, businesses across the state of Ohio and the nation are looking to hire but increasingly unable to fill job openings. Although 9.8 million Americans are unemployed, there are currently 8.1 million jobs waiting to be filled, the highest in our nation’s history. 

The disparity can be explained, in part, by the $300 per week federal unemployment insurance (UI) supplement that, when combined with the state unemployment benefits, has created a situation where more than 40 percent of workers can make more staying home than they would earn returning to work.

Senator Portman has led efforts in Congress to end the enhanced unemployment benefit and encourage a return to work. He notes that with vaccines widely available and a record number of job openings, there is no reason the federal government should be paying people not to work. Meanwhile, 24 states, including Ohio, have decided to phase out the $300 per week supplement. 

Below are Ohio media reports highlighting the struggle by business owners to get workers back in the labor force and how it’s affecting their businesses:

· “However, some businesses, especially restaurants, are still having difficulty finding employees, according to the St. Clairsville Area Chamber of Commerce. ‘There are various businesses in the area that say they just can't find workers and the people that do respond to their ads or send resumes, comes to the interview day and they don't even show up,’ Chamber Marketing/Events Coordinator Lorilee Broderson said. The chamber hopes once Ohio opts out of the $300 a week federal unemployment benefit, more people will be encouraged to work.” – WTOV, May 25, 2021

· Ohio will end pandemic unemployment assistance payments on June 26. Wheat Penny Owner Liz Valenti said since that announcement, the restaurant’s seen more applications come in. ‘We’ve actually had more applicants to positions we’ve had in, especially in the last 10 days,’ Valenti said. ‘So I do think that people are kinda realizing that that unemployment piece is going to come to an end and they’re trying to strategize where they’d like to end up in this market.’” – WDTN, May 25, 2021

· “Frangos believes finding workers amid the pandemic is challenging— in part — because extra unemployment benefits are keeping some from applying. ‘I"m sure that has hurt us with the extra money. At one point, it was $600. Now it's $300. That could be the thing that's driving it right now,’ he said.” – News 5, May 20, 2021

· A $300 federal unemployment supplemental payment weekly that's part of pandemic relief also could be having an impact on the employment picture, according to critics who say it's been keeping people from going back to work because they can earn as much or more collecting the normal unemployment benefit plus the supplemental federal payment. – Sandusky Register, May 21, 2021

· Economists blame a range of factors for the shortfall of workers, including an extra $300-a-week payment that people receiving jobless aid have been able to get, on top of their state unemployment check, since March. The federal benefit was included in President Joe Biden’s $1.9 trillion rescue package. ” – Business Journal Daily, May 27, 2021

· “He and many restaurant owners are struggling to find workers to share that love. The President of the Ohio Restaurant Association recently published an article about the issue. He said a shift to different industries, COVID-19 concerns and expanded unemployment benefits are some of the main drivers. Ken Hatfield said he's missed out on thousands of dollars in business in just the past few weeks because he didn’t have the staff for food truck events. ‘If you work somewhere and have unemployment from there and you’re getting the extra $300 a month or week from unemployment, they’d rather stay home,’ said Hatfield.” – SpectrumApril 24, 2021

· “McNeely at Flamingo Jack’s saw the hiring crunch from two angles. First, some employees he laid off found stable or better work where they are currently established. Second, he believes some don't see the need to work with unemployment benefits being an attractive alternative to a job. Some want to earn $15 an hour instead of minimum wage, he said. ‘As far as hiring new people, it's pretty hard because the people that are on unemployment are doing pretty decent, and they don't want to work,’ McNeely said. ‘Then the people that you do get to come in thinking that the new standard is starting at $15 an hour,’” – The Daily RecordApril 29, 2021

· “Look around, and you can’t miss the help wanted signs posted outside Northeast Ohio businesses, including Upper Crust Pizza and Chicken in Lakewood. ‘We have the customers. They’re calling and wanting deliveries, but I can’t provide that for them because we’re short staffed,’ General Manager Everett Amie, Jr. said. He said he’s been seeking workers for six months with just a handful of applicants, including two who took a job but then quit to collect unemployment benefits that paid more. ‘Now, with people having the ability to sit home and make more, they’re going to take that route,’ he said.” – Fox8May 14, 2021

· “‘You really need heavy staff for Friday and Saturday nights, but what do you do with those people all the other nights of the week when it slows back down?’ Tim Dawson says. ‘I think that we all know what the problem is, and that is: we're paying people too much to stay at home.’ Dawson is referring to the $300 weekly federal boost on unemployment checks, which increases unemployment payments by at least double, or even more for some workers. The federal program is supposed to last until September, but as of Tuesday, more than a handful of Republican-led states were dropping the program in June or July, citing a labor shortage.”  ABC6, May 11, 2021

· “The ‘now hiring’ signs in front of nearly every eatery and store in the city are morphing into occasional ‘closed’ signs. This included one outside the iconic Patsy’s Pizza that remained in place for the second half of April.” – The Times Leader, May 8, 2021

· Alene Candles, like many companies, is so desperate for employees at its New Albany facility, it not only offers new hires a job, but also a $1,200 signing bonus and four days off a week. The New Hampshire-based company, which opened its Licking County facility in 2012 and expanded in 2019, announced in April it seeks to hire 400 for its operation in the New Albany Personal Care and Beauty Campus, including 300 candlemakers for seasonal work and 100 full-time, year-round positions....'We need people now,' Harl said. 'We need people not just to sign on, but stay with us. We’d like to hire people, even temporary, looking for a full-time job. We’re adding people every week, but it’s a challenge.'” – Newark AdvocateMay 20, 2021

· Jobs are plentiful in Coshocton, but workers are not. Unemployment and stimulus funding means many don't want to work. Driving around Coshocton County will reveal plenty of 'help wanted' and 'now hiring' signs. There are jobs available, but there doesn't appear to be people clamoring for them….[Lynn Jacobs] said they're still seeing issues with finding candidates who can pass a drug test and have the right skills. But, it's also people not working who aren't looking. He said that can sometimes happen in the spring with people wanting to take time off, but right now stimulus funding and unemployment benefits being what they are is elevating it.”  Coshocton TribuneApril 18, 2021

· “Fronk says the restaurant industry is struggling to find people willing to work and he blames the unemployment benefits. ‘There’s just too much money being given away and some of these people if they were making 600 dollars a week with unemployment for a job they were bringing in 700 or 800 they will make sacrifices in their life to sit home, which is unfortunate,’ says Fronk….”– ABC 13 Toledo, April 14, 2021 

· “Ohio Restaurant Association President and CEO John Barker said stimulus benefits do play a role in the shortage. ‘Unemployment is an issue. There's no question about it. The intention by the government, both at the federal and state level, was to take care of people who are displaced and very much in need. No question about it. It was the right thing to do,’ Barker said. ‘The problem we have now is these are looking like they're going to be extended all the way through the fall. On top of that, people are getting those big stimulus checks. And in some cases, they may be making more money staying at home than going back to work. And so it's a combination of factors.’…” – News 5 Cleveland, April 16, 2021

· “…‘This has not been a resounding success today as far as the number of people who have come in. How would you characterize it?’ Local 12 asked Eric Plummer from Ohio Means Jobs. ‘I would say that we hoped for more people,’ he answered. ‘We’ve had four people through the doors so far. We’ve been here for about three hours.’ Plummer says it's a matter of dollars and ‘sense.’ ‘Some of the jobs just don’t pay enough to make it worthwhile to come off unemployment if that’s where they’re getting their income,’ he said. Doing the math, someone making $35,000 a year makes about $700 a week before taxes. Ohio unemployment pays $350 to that person plus another $300 from the federal COVID rescue plan. Multiply that by two for a couple and you're making about $67,500 a year.” – WKRC, May 12, 2021

· “Debonne Vineyard and Winery has worked its way through the pandemic and some nasty cold, snowy weather this spring, and now this east side winery will try and navigate what is shaping up as a shortage of workers….He believes some people are reluctant to come back to work because they have enjoyed being home during the pandemic and they are able to do that, he believes, due to increased unemployment benefits and stimulus payments.” – WOIO 19 Cleveland, May 5, 2021

· “Unable to find enough workers to staff a second shift, Lima Avenue Rootbeer Stand is open only from late morning to midafternoon, manager Jennifer Ramm said this week. Tim Hortons, on Interstate Court, planned to have four people working, plus a baker one recent day. But only two employees plus a baker made it to work that day, said assistant manager Krysta Wright. ‘We had somebody today just not show up,’ she said. In some cases, people get more money drawing unemployment compensation — the state benefit plus a federal top off because of the pandemic — than they would earn working….” – The Courier, May 1, 2021

· “A survey of Dayton Area Chamber of Commerce members found that 78% said they can’t find the workers they need now for open job, Chris Kershner, CEO and president of the chamber, told the Dayton Daily News. ‘This is a major problem. With the added COVID-19 unemployment benefits, you basically have private industry competing against the federal government for workers,’ Kershner said. ‘We need to fully reopen the economy and these added benefits are a significant barrier to get people back to work.’…” – Dayton Daily News, May 8, 2021

· “Scott Super and his wife Tammy have owned Mayberry Diner for 20 years. The pandemic has been challenging but he says even difficult events like the recession never made finding workers this hard….Super believes extended pandemic unemployment assistance has hurt the incentive to come back to work for some.” – WTOL Toledo, March 1, 2021

· “Megan Hausch, executive director of Williams County Economic Development Corporation (WEDCO), commented that while each economic development office is concentrating on what is within the boundaries, job seekers do not see the county lines or state lines when looking for work….With the positives of new businesses choosing Williams County and current businesses, two concerns come to the forefront. A shortage of manpower was beginning to be felt even before COVID-19 ‘put the pause button on workforce needs,’ Hausch added. With employment levels back up to the pre-COVID level, county employers still need as many as 500 employees…The thought being expressed is that the extra Federal unemployment benefits being offered are preventing people from coming back to work. Hasch said employers in the five counties of Defiance, Fulton, Henry, Paulding, and Williams have participated in a wages and benefits survey conducted by Ohio Means Jobs Centers to determine how wages are being affected and what businesses are doing to attract new employees.” – The Crescent News, April 24, 2021

· “…The unemployment rate remains elevated from pre-pandemic levels and millions of people are out of work, but still there's a shortage of applicants. That's in part due to unemployment benefits creating a disincentive to return to work, a desire for higher wages in the restaurant industry, and the continued fear of getting sick with the virus….” – Business Insider, April 25, 2021

· “…Unemployment benefits—extended and elevated throughout the pandemic—are keeping would-be applicants away. The $1.9 trillion COVD relief plan passed by Congress extended the $300 weekly federal payments to unemployed workers through September 2021. The calculation is simple. Many low and unskilled workers can make as much money not working as they could with a job—sometimes more. So, they stay home.” – The Dispatch, April 15, 2021

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