More than 1.2 million Americans will lose pandemic unemployment benefits early as more Republican states drop relief

More than 1.2 million jobless Americans are set to lose their pandemic unemployment benefits early, with Georgia becoming the latest Republican-led state to announce it would cease providing enhanced federal jobless payments.

Citing workforce shortages, at least 14 states have announced since last week that they would terminate the $300 weekly federal boost to state benefits, as well as the federal expansion of jobless benefits to those who previously didn’t qualify and those who have run out of their regular state benefits.

The payments, which Democrats recently extended until early September as part of their $1.9 trillion coronavirus rescue package, will end as soon as June 12 in some states.

“These changes have the potential to drastically scale back assistance to jobless workers far too early in the recovery,” said Andrew Stettner, senior fellow at The Century Foundation, who calculated how many people would be affected. “Nationally, there are still 16.8 million workers on one of the unemployment programs, and the nation is still short 8 million-plus jobs from the start of the pandemic.”

The jobless will lose roughly $6 billion in payments in the states curtailing benefits, Stettner said.

Of particular concern, he added, are the 750,000 out-of-work Americans who are currently in the Pandemic Unemployment Assistance and the Pandemic Emergency Unemployment Assistance programs. Those recipients will not receive any payments once their states withdraw.

Those programs, which were created by Congress in March 2020 to address the coronavirus-fueled economic upheaval, broadened benefits to freelancers, independent contractors, the self-employed and certain people affected by the coronavirus, while the latter extends the duration of regular state benefits.

Those on regular state benefits, which typically last up to 26 weeks, will continue receiving that compensation, but stop getting the $300 federal supplement.

If all Republican governors were to pull out, some 4.8 million workers would be affected, and $29 billion in payments would be lost.

These funds don’t only help the jobless, experts argue. They help local businesses and economies because those out of work are able to continue spending on groceries, housing costs and other items.

“The same businesses that are complaining about not being able to find an extra dishwasher, they are taking swipe and after swipe from unemployed people on their debit cards to buy food,” Stettner said. “It’s just really short-sighted.”

A nationwide trend

Montana Gov. Greg Gianforte last week was the first to say he was pulling out of the federal program, saying that businesses in the state can’t find workers because the generous unemployment benefits were keeping people on the sidelines.

The announcement was followed by South Carolina, Arkansas, Alabama, Mississippi, North Dakota, Missouri, Iowa, Idaho, Tennessee, Wyoming, South Dakota and Utah. Other red states are likely to follow.

States can terminate their agreements with the federal government to participate in the programs, under to relief package’s provisions.

Georgia Gov. Brian Kemp announced Thursday that the state would cease the $300 federal payments and pandemic programs on June 26.

“Thanks to our measured reopening, Georgia’s unemployment rate is well below the national average,” he tweeted, referencing the state’s 4.5% unemployment rate in March. “Now it is time for Georgians to get back to work so we can fully return to normal in the Peach State!”

The terminations are likely to widen the split between Republican officials and business owners on one side and Democrats and workers on the other. The former point to the growing shortage of workers as evidence that people would rather stay home than accept job offers.

Democrats and workers, however, argue that millions of people remain out of work and cannot return easily because their children are still learning remotely or they remain concerned about the coronavirus.

More than 4.2 million people said they are not working because they are concerned about getting or spreading the virus, according to census survey data from the second half of April.

Nearly 2.5 million said they had coronavirus symptoms or were caring for someone who did, and 6.8 million said they were caring for children who were not in school or daycare.

President Joe Biden, while warning Monday that people who can work must accept offers or lose their benefits, said most Americans want to be employed if possible.

Vermont Sen. Bernie Sanders on Thursday sent a letter to Labor Secretary Marty Walsh asking him to commit to holding states accountable for their role in administering the benefits.

“Democrats in Congress secured life-saving unemployment aid to workers so they wouldn’t have to go back to work for starvation wages or without childcare,” Sanders tweeted, adding that he asked Walsh “to ensure Republican governors do not strip that assistance away.”

The Labor Department did not immediately return a request for comment.