Montana to end expanded jobless benefits in June, offer return-to-work bonuses

Montana will stop offering expanded unemployment benefits in June and give bonuses to recipients of jobless aid who come back to work to help tackle labor shortages, Gov. Greg Gianforte (R) announced Tuesday.

Gianforte said that Montana will end participation in a range of federal programs created in March 2020 by the CARES Act and extended several times throughout the coronavirus pandemic to support millions of Americans forced out of work by COVID-19, the first state to do so.

After June 27, Montana will stop giving recipients of jobless aid the additional $300 per week offered through Federal Pandemic Unemployment Compensation. 

The state will also stop participating in the Pandemic Emergency Unemployment Compensation program — which provides additional weeks of federally funded jobless aid to recipients who’ve exhausted their state allowances — as well as Pandemic Unemployment Assistance, which expanded benefits to gig workers, contractors and others who don’t qualify for traditional unemployment insurance. 

Those programs were extended through August by President Biden’s $1.9 trillion COVID-19 relief bill, which he signed in March.

Montana will instead use funds from the March relief bill to give $1,200 bonuses to people who had an active unemployment claim as of May 4, accept a job offer and complete at least four weeks of paid work.

“Montana is open for business again, but I hear from too many employers throughout our state who can’t find workers,” Gianforte said, arguing that “nearly every sector in our economy faces a labor shortage.”

Montana’s decision to pull back jobless aid comes amid an escalating debate over why businesses across the U.S. are struggling to hire workers to meet a rush of demand despite millions of Americans still being unemployed. Owners of restaurants, bars, factories and stores have complained about challenges finding applicants as demand for their goods and services rise.

Many Republicans and right-leaning economists argue that expanded unemployment aid is keeping workers on the sidelines because the federal supplements push weekly benefits above the average wage in some states. 

But Democrats, progressive advocacy groups and many center-left economists say jobless aid likely plays little to no role in why some businesses are struggling to hire. They instead point to ongoing health concerns and the millions of workers — predominantly women — who were forced out of the labor force to take care of children or loved ones in need.

“There are lots of anecdotal reports swirling around about employers who can’t find workers,” Heidi Shierholz, policy director at the left-leaning Economic Policy Institute, wrote in a Tuesday op-ed. “But a closer look reveals there may be a lot less to this than meets the eye.”

Shierholz said that while there may be bona fide labor shortages in some pockets of the country, there are still too few jobs for too many unemployed workers. 

“In the latest data on job openings, there were nearly 40 percent more unemployed workers than job openings overall, and more than 80 percent more unemployed workers than job openings in the leisure and hospitality sector,” she said.

She added that those businesses should raise wages to attract more workers, particularly because service jobs “are inherently more stressful and potentially dangerous because workers now have to deal with anti-maskers and ongoing health concerns.”