HELENA, Mont. — Montana is ending its participation within the federal unemployment program that offers folks extra weekly unemployment profit funds because the state struggles with a worker shortage, Republican Gov. Greg Gianforte introduced Tuesday.
Beginning June 27, unemployed employees within the state will not obtain $300 in weekly extra benefits funded by the federal authorities by means of Sept. 6.
The state will launch a brand new program to present bonuses to unemployed employees who return to work.
“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 mentioned in a press release.
He mentioned that the extra federal unemployment advantages are “doing more harm than good,” echoing feedback by some that the extra funds have served as an incentive for folks to remain house, acquire the cash and never search work.
U.S. Labor Secretary Marty Walsh was dissatisfied by Gianforte’s choice, in response to a press release by U.S. Labor Department spokesperson Michael Trupo.
“Choosing to eliminate these critical benefits will have the greatest impact on the most vulnerable,” Trupo mentioned, including that employees who’re at the next danger from contracting Covid-19 or who reside with a susceptible member of the family should now “make an impossible choice” between their well being and their financial safety.
The Labor Department has not seen proof that enhanced unemployment advantages are conserving folks out of the labor drive, Trupo mentioned.
Montana unemployment recipients can get between $151 and $510 weekly from the state’s program, which means folks claiming unemployment advantages from the state have been getting between $451 and $810 weekly due to the federal enhance.
The minimal wage within the state is $8.65 per hour, including as much as $346 per week for a full-time job.
Under the brand new Montana incentive program, employees receiving unemployment funds can qualify for a one-time $1,200 bonus after they’ve accomplished 4 weeks of their new jobs. The governor authorised $15 million in funding for the incentives from federal coronavirus reduction cash allotted to the state.
There are about 25,000 folks submitting unemployment claims for funds within the state, in response to the Montana Department of Labor. The division additionally estimates there are about 14,000 job openings.
The state’s unemployment fee dropped to three.8 p.c final month, reaching pre-pandemic joblessness ranges. Despite an inflow of recent residents to the state, Labor Commissioner Laurie Esau mentioned the state’s workforce is 10,000 employees smaller than it was earlier than the pandemic
“Our labor shortage doesn’t just affect employers and business owners. Employees who are forced to work longer shifts, serve more customers or clients, and take on more duties have been paying the price,” Esau said in a statement.
A bipartisan advisory commission, made up of lawmakers and members of the executive office, unanimously approved the incentive program Tuesday before the governor approved it.
The program will run through October and has funding to give the bonuses to as many as 12,500 workers.
The bonuses will be distributed on a first-come, first-served basis. Workers who leave their new jobs after receiving the bonus would not qualify for unemployment benefits.
Those rules would “hopefully act as incentives to try to get people to use this quickly, in a right way, for a good job, something that is sustainable,” mentioned Scott Eychner, an administrator with the Department of Labor.
Montana’s unemployment payment claims rose from a pre-pandemic average of around 10,000 per month to 85,000 in April of last year.
The federal government last spring approved $600 in additional weekly benefits for unemployed workers receiving payments from their states’ unemployment programs. That benefit expired in July and was later replaced by the $300 in additional weekly benefits.
In addition to ending participation in the increased unemployment payments, Montana will also require unemployed people applying for benefits to actively seek work to qualify starting at the end of June, a requirement that was waived at the onset of the pandemic. Several states have also announced they will reinstate the work-search requirement, including Vermont, New Hampshire and Arizona.
A 13-week limit on the duration of eligibility for unemployment benefits that was waived during the pandemic will be reinstated. Self-employed workers and independent contractors were eligible for benefits under the extended program but will no longer qualify for Montana unemployment payments.
Several business owners released statements Tuesday applauding the governor’s announcement, saying it would help them find employees.
“Finding employees has become our biggest challenge,” said Laura Carden, chief financial officer of Wheat Montana Farms & Bakery in Three Forks.
Brad Griffin, president of the Montana Restaurant Association, called the announcement “a step in the right direction.”
But some expressed skepticism over the move, saying it did not address the underlying concerns leading jobs to go unfilled in the state, including rising housing costs and wages that are not high enough to pay the bills.
Billy McWilliams, owner of an adult sex store in Bozeman, said he has seen employees leave over the rising cost of living. The policy change “is not addressing the real problems we’re facing,” he said.
In towns like Bozeman, where costs of housing have skyrocketed during the pandemic, workers “are not getting jobs because these jobs don’t pay enough to pay their bills,” McWilliams said.
Samuels is a corps member for The Associated Press/Report for America Statehouse News Initiative. Report for America is a nonprofit nationwide service program that locations journalists in native newsrooms to report on undercovered points.