A leftover from yesterday, made timely by today’s gruesome jobs report. Florida law requires people who are out of work to contact five employers per week about openings in order to remain eligible for unemployment benefits. Last year the state waived that requirement amid the COVID-driven economic collapse. No sense in asking those who’d been laid off to look for jobs when most businesses were closed or subject to capacity limits, right?
But now the crisis is easing. One hundred million Americans are vaccinated. DeSantis, who’s been ahead of the national curve in reopening, lifted all local restrictions on businesses a few days ago. Employers, particularly in the service and hospitality industries, are desperate for workers — and can’t find them. Florida Republicans have a theory why.
Why is anyone surprised that the jobs reports fell short of expectations?
— Marco Rubio (@marcorubio) May 7, 2021
The waiver allowing Floridians to collect unemployment without proving they’ve sought work expires on May 29. DeSantis announced yesterday that he’s not renewing it.
“Normally when you’re getting unemployment, the whole idea is that’s temporary, and you need to be looking for work to be able to get off unemployment,” DeSantis said at a news conference. “It was a disaster, so we suspended those job search requirements. I think it’s pretty clear now, we have an abundance of job openings.”…
“I think now we’re in just a different situation, you have a surplus of jobs, particularly in restaurant, lodging, hospitality, that people want to hire,” DeSantis said. “I mean, you see the signs all over the place. Look, that’s a good problem to have. But we also just want to make sure, like, look, if you’re really unemployed, can’t get a job, that’s one thing. But making sure that you’re doing your due diligence to look for work, and making sure those incentives align, better.”
The state senate recently proposed boosting unemployment benefits by $100 per week and reducing the job-search requirement from contacting five employers weekly to three. DeSantis wouldn’t go for it. Starting three weeks from tomorrow, laid-off Floridians will need to start pounding the pavement if they want to keep collecting.
Which means, given how far hiring last month fell short of expectations, we’re about to embark on an exciting national debate over whether beefed-up unemployment benefits are holding back economic growth or whether the sluggish growth means those benefits are now more important than ever. Guess which position the White House is taking.
The White House believes today's job reports illustrates the importance of providing robust unemployment support with millions of Americans still out of work, a senior administration official says
— Jeff Stein (@JStein_WaPo) May 7, 2021
There’s evidence that DeSantis and Rubio are right to worry about robust benefits as a deterrent to employment, though. Even some experts who viewed that as less of a concern earlier in the pandemic, when consumer demand fell off a cliff, are now thinking hard about it:
While fears of a labor shortage are most pressing for the restaurant and bar industry, Google searches for job openings fell sharply in March and have just begun to level out, according to Daniel Zhao, senior economist at job posting and employer review website Glassdoor…
Zhao — along with Ioana Marinescu of the University of Pennsylvania and Daphné Skandalis of the Federal Reserve of New York — found in a study released last month that a 10 percent increase in unemployment benefits caused a 3.6 percent decline in applications.
While that effect didn’t prevent vacancies from being filled when unemployed workers outnumbered open jobs several times over, that dynamic could be different with more job openings on the way.
Zhao cautioned that there’s no single silver-bullet explanation for why hiring is anemic, which is doubtless true. Why, here’s another contributing factor to today’s terrible jobs numbers courtesy of the NYT: “Millions of Americans have said that health concerns and child care responsibilities — with many schools and day care centers not back to normal operations — have prevented them from returning to work.” In other words, by not putting more pressure on blue-state governors to reopen schools aggressively, the Biden administration has the country trapped in a vicious circle. Parents who are willing to work can’t do so because they have to stay home with their kids, who aren’t in school; the White House seeks to ease their financial distress by keeping robust unemployment benefits going; and that robust unemployment further incentivizes parents and other jobless adults to be less proactive about seeking work than they otherwise would be. If Sleepy Joe wants to see “recovery summer” get going in earnest, the first thing he should do is start pounding the table about school reopenings. Anyone think he will?