Birmingham, Ala. – Today (May 10, 2021), the Alabama Policy Institute (API) called on Governor Ivey to lead the nation and end the state’s participation in the now-unnecessary enhanced unemployment benefits program extended by the federal act known as the American Rescue Plan.
As the basis for doing so, API pointed to the overwhelming number of stories of private sector businesses facing a shortage of willing workers to fill the ranks of Alabama’s workforce. In fact, market analysis from the national Society for Human Resource Management suggests the common thread in the hiring shortage appears to have shifted from fear of the coronavirus to the simple fact that people are being paid to not work by the government.
“With unemployment rates decreasing every month and employers across the state desperately looking for workers, it is time for Alabama to end disincentives to work,” API President and CEO Caleb Crosby said. “These enhanced benefits, an additional $300 a week, offer some workers $2,300 a month not to work when added to regular benefits. They are the definition of a disincentive to work.”
Alabama would not be the first state to end these enhanced benefits.
“The governors of both Montana and South Carolina have recently announced their intention to withdraw their states from the federal programs,” API Chief Policy Officer Phil Williams said. “Florida and North Carolina are strengthening their work requirements. And South Dakota never accepted the increase in benefits in the first place. It is time for Governor Ivey to end these disincentives to work. As Governor Gianforte in Montana said, unemployment benefits should be a safety net, not a career choice. By joining with these other states, Alabama has an opportunity to lead the nation in post-pandemic economic growth.”
Enhanced unemployment benefits started in the spring of 2020 through the federal CARES Act plan passed on March 27, 2020 as a way to offer relief during government-mandated shutdowns. Though the shutdowns have ended, the benefits have not.
“The worst health effects of the pandemic are behind us,” API President and CEO Caleb Crosby concluded. “By ending these unnecessary unemployment benefits, Governor Ivey can ensure that the worst economic effects of the pandemic are behind us as well.”
Founded in 1989, API is an independent, nonpartisan, nonprofit research and educational organization dedicated to strengthening free enterprise, defending limited government, and championing strong families.