President Biden on Monday claimed that generous unemployment benefits are not incentivizing people to remain out-of-work, arguing that Americans would return to the workforce for a “decent wage,” but nevertheless said that the administration would take action to push would-be workers to accept job offers instead of staying home.
“People will come back to work if they’re paid a decent wage,” Biden said in an address on the economy at the White House. “My expectation is that, as our economy comes back, these companies will provide fair wages and safe work environments. And if they do, they’ll find plenty of workers.”
“We’re going to make it clear that anyone collecting unemployment who is offered a suitable job must take the job or lose their unemployment benefits,” Biden continued, before arguing that the dynamic he vowed to address is not prevalent anyway.
“I know there’s been a lot of discussion since Friday’s report that people are being paid to stay home rather than go to work,” he added. “Well, we don’t see much evidence of that.”
Biden’s remarks come days after the April jobs report showed the U.S. economy added just 266,000 jobs last month, falling well below economists’ estimates of 1 million jobs added. The discrepancy was the largest miss relative to expectations since at least 1998.
The U.S. Chamber of Commerce and a number of economists faulted the $300-per-week federal jobless benefit for encouraging Americans to remain out-of-work.
“Paying people not to work is dampening what should be a stronger jobs market,” the chamber said in a statement.
However, Biden, who supported an unsuccessful effort to hike the federal minimum wage to $15, suggested that businesses that have received COVID relief funding from the government should put some of that money toward raising wages to encourage a return to work.
However, Senator Ben Sasse (R., Neb.) rebuked the extended unemployment benefits as a “policy failure.”
“We should be clear about the policy failure at work here: There are 7,400,000 jobs open in the U.S. — but fewer than 300,000 found work last month,” Sasse said in a statement. “Why? This tragedy is what happens when Washington know-it-all’s decide to pretend they’re generous by paying more for unemployment than for work.”
Senator Marco Rubio (R., Fla.) shared a similar sentiment in a tweet Friday: “Why is anyone surprised that the jobs reports fell short of expectations? I hear from #smallbusiness everyday that they can’t hire people because the government is paying them to not go back to work.”
The National Federation of Independent Businesses reports that business owners have struggled to hire help, with more than four in ten business owners saying they have open positions that have not been filled.
A study published earlier this year found that for every 10 percent increase in unemployment benefits, job applications decline by nearly 4 percent.
Montana Governor Greg Gianforte, a Republican, announced last week that his state would end its participation in the federal pandemic unemployment benefit programs. He said the state would instead offer bonuses to residents who return to the workforce.
“Montana is open for business again, but I hear from too many employers throughout our state who can’t find workers. Nearly every sector in our economy faces a labor shortage,” Gianforte said in a news release.
“Incentives matter,” he added, “and the vast expansion of federal unemployment benefits is now doing more harm than good. We need to incentivize Montanans to reenter the workforce. Our return-to-work bonus and the return to pre-pandemic unemployment programs will help get more Montanans back to work.”
Arkansas and South Carolina also announced they would pull out of the program.