As Businesses Struggle to Hire, 23 States Move to Cut the Extra Unemployment Benefits

As businesses emerge from the pandemic they're facing a labor shortage and it's affecting everything from Main Street retail to the corporate world.

"I've not seen anything like this market. It's been absolutely crazy," said Kristin Jiles, an eSearchPro executive sales and marketing recruiter. "I have employers that I work with that are wanting to see 3, 4, 5, 6 candidates before they make a decision, and unfortunately, there aren't 3, 4, 5, 6 quality candidates."

The same story is playing out across other sectors like retail.

"We are short workers and people are doing everything to get people back," said Anthony Anton, the president of the Washington Hospitality Association.  

Anton says 100,000 workers are needed right now.

One Washington pizza shop is offering an $800 hiring bonus. An Amazon Fresh about to open in Bellevue will give a $1,500 sign-up bonus to new employees. 

Anton says it's a workers market and many job candidates are asking for more. "From financial to benefits, we're getting requests for our healthcare program," he said. "It's at an all-time high."

Across the country, businesses are digging deep to recruit.

New hires at Amazon get a $1,000 signing bonus. McDonald's, Target, and Costco have also agreed to bonuses or higher wages. Chipotle will offer free college tuition.
 
But with 16 million Americans still receiving unemployment benefits, many are asking why it's so tough to hire.

A major concern is that $300-a-week federal unemployment benefits are giving people a reason to not work.

Research suggests that when that federal benefit is included, about half of all the unemployed are receiving more income from unemployment than their previous work.

It's why 23 Republican governors are ending the federal benefit starting next month. 

Joel Griffith, a research fellow in the Roe Institute at The Heritage Foundation, applauds the move.

"Those benefits, rather than providing a safety net, provide more of a hammock for people," he told CBN News. "When you can earn $40,000 or $50,000 equivalent to pre-tax income by not working, for many people they'll choose not to work at all."

Unemployment numbers are beginning to drop. Economists say schools re-opening will help as childcare issues have forced many parents to quit work. Vaccinations and people returning to good health could also make a difference.

Another promising sign – consumers are spending at a healthy rate. Many economists predict the economy will expand by 7% in 2021, the fastest annual growth in more than 30 years.

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