Bonuses up to $ 10 thousand: how some states are trying to motivate people to look for work

Connecticut, Oklahoma and Montana are trying to convince unemployed people receiving increased benefits during the pandemic to return to work. The states offer cash bonuses for people who find full-time jobs. The edition told in more detail CBS News.

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Connecticut authorities said they will award between $ 1 and $ 000 to those unemployed who are employed full-time and have worked for at least eight weeks. Oklahoma, meanwhile, said it will provide bonuses of $ 10 to the first 000 unemployed people to find a full-time job and keep it for at least six weeks. Earlier this month, Montana announced a similar initiative that will provide a $ 1 bonus to those who return to work for at least four weeks.

These efforts come amid a broader labor market debate as the US economy continues to recover from the COVID-19 pandemic.

Restaurants and other businesses that are currently reopening say they struggle to find employees to fill open vacancies. Some conservative lawmakers cited the disappointing job numbers for April as evidence that the additional $ 300 a week unemployment bailout is keeping workers on the sidelines.

That prompted at least 19 Republican-led states to cut additional jobless aid months before it was set to expire in September. They say the move will help business owners who complain they can't find employees for open positions. These states include Oklahoma and Montana.

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“The biggest challenge Oklahoma businesses face today is not reopening, but finding employees,” Gov. Kevin Stitt said in a statement about the new program.

Many economists and labor experts say the problem is more complex than an additional $ 300 weekly unemployment relief benefit. According to a census survey conducted from April 14-26, about 4 million people said they were not entering the labor market due to fears of contracting or spreading COVID-19.

Providing the bonus can help some workers who are transitioning from unemployment to the workforce, as there is often a gap between the end of an unemployment benefit payment and the first paycheck, said Andrew Stettner, unemployment insurance expert at the Century Foundation. But giving a bonus to people who already have a job won't help those who remain unemployed, he stressed.

Some workers may simply wait until they find a job they want to take. And many families continue to be hampered by the lack of childcare during distance learning, making it difficult for some parents, especially mothers, to return to full-time work.

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“We have very generous unemployment insurance right now, which means people have the flexibility to wait for the right job,” said Leo Fehler, senior economist at the UCLA Anderson School of Management. “Women have a lot of responsibility: they need to take care of children, supervise homeschooling, and this prevents them from getting a job.”

Workforce changes

Plus, according to a Bank of America report, the workforce is not what it was before COVID-19. Experts estimate that about 1,2 million people over 65 retired during the pandemic, and another 140 workers have died from coronavirus infection. Another 000 people quit due to skill mismatches. That is, according to economist Joseph Song, they lack the education or skills that employers now expect from their new hires.

Song estimates that about 1 million people are excluded from the labor market due to additional unemployment assistance. Most likely, these are low-paid workers who receive more from unemployment than from their old job. The bottom line, he said, is that many of these workers are likely to return to work when unemployment benefits expire in September.

The question now is whether the temptation of a one-time bonus will convince people concerned about COVID-19 or dealing with childcare issues to return to work. Connecticut said its bonus is aimed at helping people who have been unemployed the longest find work by helping to cover the costs of finding and starting a new job. The state has not canceled the $ 300 additional weekly unemployment benefits paid by the federal government.

“This pandemic has disproportionately affected women, racialized communities and low-income workers, and it happened almost overnight,” Connecticut Labor Commissioner Kurt Westby said in a statement.

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