Colorado employers wanted Jared Polis to end enhanced benefits. Good luck with that

AP Photo/David Zalubowski

Last week, a bipartisan group of hundreds of business owners and employers in Colorado got together to send a letter to Governor Jared Polis. They were asking that he put an end to the $300 per week federal enhancements to unemployment benefits, as the governors of other states have already done. Their underlying message was, ‘we need our workforce back.’ There are help-wanted signs all over the state, but not enough workers to fill nearly all of the positions.

They didn’t have to wait long to get their response. The Governor said that while he wishes he could help, this is “free money” from the federal government and he just can’t turn it away. He also curiously claimed that the money was actually helping the business owners who can’t find enough workers to return to full operations. So with all of this “free money” floating around, they’ll just have to find some other way to get things done. (CBS Denver)

“I wish that we could use the money for something else, but this is $600 to $800 million that the federal government is pumping into Colorado,” Gov. Polis said.

Polis said the weekly payments are temporary and helping businesses in Colorado.

“This current money is only here for another month, but if we cut it off, it would be less money for our retail businesses, for our stores,” Polis said Wednesday.

This was a tone-deaf answer at best, with several parts to it. First of all, Polis is saying that the money is “helping businesses” because the unemployed have more cash in their pockets to spend. That may be true, but they won’t be spending much of it at businesses that can’t fully reopen because they don’t have enough workers.

Polis is also telling the employers that it’s “only another six weeks” until the enhanced benefits expire. Six weeks may not seem like a long time to the governor, but it’s six weeks in the heart of the summer. That’s vacation season for a lot of people and many of these businesses rely on a summer surge in customers to keep them in the black for the year. They’ve already been shut down or severely limited for more than a year and they were told that the country was reopening. But you can’t reopen without workers.

The only other option that Polis and other Democrats are offering is to raise wages and expand benefits. That’s a path that many employers have been forced to follow, but they have to pass along those increased labor costs to their customers, raising the prices of everything and further exacerbating inflation at the same time. And it’s only a temporary remedy anyway. When the “free money” runs out and workers feel compelled to come back to work, the extra labor supply is just going to drive wages back to somewhere around pre-pandemic levels.

I eagerly await the next missive from Polis on this subject. I imagine it will include the phrase let them eat cake.