What Does a Labor Shortage Mean for Unemployment Benefits?

I have heard some states are cutting off federal benefits, such as an extra $300 a week, before the September expiration date. Is that happening in my state?

At least nine states have said they are rejecting extra pandemic-related benefits. Iowa, Mississippi, Missouri, Montana, North Dakota and South Carolina have sent letters to the Labor Department asking to end their participation in federal programs. Those include a $300 supplemental benefit, extended payments and benefits for gig-economy and other workers not typically eligible for unemployment benefits.

Alabama, Arkansas and Tennessee have said publicly they plan to opt out of the programs early, but they hadn’t sent letters to the Labor Department as of Tuesday.

Will I receive a return-to-work bonus when my jobless benefits expire?

Most states aren’t offering a bonus. However, Republican Gov. Greg Gianforte of Montana said residents would be eligible for a $1,200 “return-to-work bonus” if they were receiving unemployment benefits as of May 4 and subsequently took a job and completed at least four paid weeks of work.

States are reinstating job-search requirements. What are they?

Job-search requirements vary by state, but generally call for unemployment-benefits recipients to provide evidence that they are looking for work. That might include proof of applying for work online, attending a job interview or participating in a career fair. People can lose their benefits if they don’t document their searches.

How do I know if my state is changing job-search requirements?

More than half of states have re-implemented job-search requirements for unemployment-benefits recipients after many waived them at the beginning of the pandemic. Some states including Nebraska, North Dakota and Louisiana revamped job-search requirements last summer. On Monday, President Biden directed the Labor Department to work with remaining states to reinstate job-search requirements.

How do I provide proof of a job search?

State unemployment websites provide information on what steps benefits recipients should take to fulfill job-search requirements. States often require job seekers to contact at least one employer a week and complete a “work-search log” that they might need to submit to their unemployment agency, according to job site ZipRecruiter.

For instance, unemployment beneficiaries in Nebraska must contact five employers a week. They are required to log their work searches online before or while claiming weekly benefits.

Can I turn down a job offer to continue collecting unemployment benefits?

Generally, no. Mr. Biden clarified on Monday that under unemployment-insurance law, if a person collecting jobless benefits receives a “suitable” job offer, they must take it or lose their benefits. The definition of a suitable job offer differs across states but typically applies when someone is recalled to their previous workplace.

Mr. Biden said unemployment recipients could turn down work in specific cases, such as if their children can’t go to school because of the pandemic.

Are unemployment benefits deterring work searches?

Some Republicans and economists say yes, because many unemployment recipients earn more than they would at work. With the additional $300-a-week federal benefit, the average unemployment recipient earns better than the equivalent of working full time at $15 an hour. “Federal pandemic-related unemployment benefit programs initially provided displaced Iowans with crucial assistance when the pandemic began,” Iowa Gov. Kim Reynolds said. “But now that our businesses and schools have reopened, these payments are discouraging people from returning to work.”

Some Democrats and economists say no, citing factors other than unemployment benefits that are keeping workers on the sidelines, such as fear of getting sick during the pandemic and lack of full-time child care. Additionally, state unemployment-insurance programs include re-employment services. “Unemployment insurance is not a disincentive. It’s actually the main tool by which we keep people who are out of work supported in their goal to return to work,” said Michele Evermore, a Biden administration official.

Write to Sarah Chaney Cambon at [email protected]