THOMPSON: NC should end federal unemployment assistance to encourage people to reenter the workforce

A tractor trailer rig pulls into a terminal for a trucking company that has a $10,000 hiring bonus offer posted on a trailer at their facility in Harmony, Pa., Wednesday, May 5, 2021. (AP Photo/Keith Srakocic)

Last spring, when businesses were cutting back or closing because of the pandemic, Congress passed a bill giving people an extra $600 a week in unemployment benefits. That was later trimmed to $300, but it was still essential, because it helped families make it through one of the most abrupt economic crises in American history. 

One year later, the government has eased social distancing and other COVID-19 restrictions, and businesses are open and hiring. North Carolina’s unemployment rate has dropped to 5.2% after jumping to 13.5% in April 2020, but here’s the thing: 

Our jobless rate should be even lower. More people could be working. 

The problem isn’t a lack of jobs. Businesses not only are hiring, they’re offering signing bonuses, flexible hours, and health benefits; but it’s not enough. Job openings still outnumber job applicants. According to a recent survey by the National Federation of Independent Business, a record 44% of small business owners nationwide have positions they’re unable to fill.  

Some people are still anxious about the coronavirus, while others may need to stay home to care for young children or elderly relatives, but perhaps the biggest reason why many people aren’t re-entering the workforce is that extra $300 a week. 

Speaking recently at NFIB’s North Carolina Virtual Small Business Day, House Speaker Tim Moore said, “You literally have a situation right now where, depending on the kind of wages or salaries that folks would be earning, they are earning more in unemployment by staying at home and doing nothing than by entering the workforce, and it’s an absolutely ridiculous situation.”  

That’s why NFIB is urging Gov. Cooper to follow the lead of South Carolina, Tennessee, Georgia and other states and end these additional payments.  

It’s easy to forget, but this additional payment was always intended as a temporary fix, a bonus to help people get through an extraordinarily difficult time. It wasn’t that people who lost their job could turn around and get a new one; there were no jobs to get. Even if North Carolina does nothing, even if Gov. Cooper takes no action, the federal supplement is set to expire in September.  

The problem is, North Carolina can’t wait. 

During the worst of the pandemic, businesses across the state had to reduce hours and limit services because of social distancing. Now, they’re doing it because they can’t find enough people to work. The labor shortage is making it harder for businesses of all sizes to meet customers’ needs.  

“You can’t go anywhere, from the cities to out here in the small towns where I am, and not see ‘help wanted’ signs, not see reduced hours for businesses,” Speaker Moore said on his call with NFIB members. “It is….just an abomination, what the government is doing to the business community right now and allowing this runaway spending on unemployment when there are jobs that need to be filled.”  

If Gov. Cooper is serious about helping North Carolina’s economy recover fully and quickly from the pandemic, he will move to end these additional payments now rather than wait until they expire on their own in four months.   

Gregg Thompson is the state director of the National Federation of Independent Business.