Extra unemployment benefits will end in June, Reynolds orders

Unemployed Iowans will lose their extra $300 per week benefit and other federal pandemic unemployment assistance in June, Gov. Kim Reynolds announced Tuesday.

“Federal pandemic-related unemployment benefit programs initially provided displaced Iowans with crucial assistance when the pandemic began,” Reynolds said in a press release. “But now that our businesses and schools have reopened, these payments are discouraging people from returning to work.”

After June 12, the following pandemic unemployment programs will no longer be available to Iowans:

• Federal Pandemic Unemployment Compensation (FPUC), an additional $300 per week to everyone receiving state or federal unemployment payments.
• Pandemic Unemployment Assistance (PUA), unemployment insurance benefits for those who lost their job due to COVID-19. These payments come from the federal government, rather than state employers.
• Pandemic Emergency Unemployment Compensation (PEUC), federal unemployment insurance benefits for individuals who used up their state allotment during the pandemic. 
• Mixed Earners Unemployment Compensation (MEUC), an additional $100 per week for individuals who earned at least $5,000 a year in self-employment income.

The announcement comes amid a national debate over low employment in the United States. The Bureau of Labor Statistics on Friday released the April jobs report, which found 266,000 jobs added, far fewer than the 916,000 jobs added in March. The federal unemployment rate was 6.1%. Iowa’s unemployment rate was 3.7% in March.

The U.S. Chamber of Commerce, the country’s largest business lobbying group, blamed the additional $300 a week payment for “dampening what should be a stronger jobs market.” Reynolds joins several Republican governors who have chosen to discontinue the additional unemployment benefits in the hopes of increasing employment rates. Leaders of Alabama, Mississippi, Montana, South Carolina and Arkansas said they will discontinue the benefits sometime this summer. 

Without state intervention, the federal programs are scheduled to end in September. 

President Joe Biden on Monday objected to claims that increased unemployment benefits were keeping workers out of the labor market. He pointed toward existing law that requires unemployed individuals to accept job offers or lose their unemployment payments. 

“If you’re receiving unemployment benefits and you’re offered a suitable job, you can’t refuse that job and just keep getting unemployment benefits,” Biden said.

In Iowa, people must make at least two job inquiries per week while receiving unemployment insurance benefits.

Biden press secretary Jen Psaki noted that other factors, such as child care, schools reopening and vaccination rates, could contribute to lower job-finding rates.

“There is also the need to pay a livable, working wage,” Psaki said.

Iowa Democratic leaders objected to Reynolds’ decision to end the federal pandemic unemployment benefits. 

“It makes no sense for Governor Reynolds to pull the rug out from under unemployed Iowans while we are in the grip of a worldwide pandemic,” Senate Minority Leader Zach Wahls, D-Coralville, said in a press release. “… The federal relief is helping Iowans stay housed, clothed, and fed.”

Rep. Todd Prichard, House minority leader, echoed the sentiment, writing that the decision to stop federal assistance could slow the state’s economic recovery.

U.S. Rep. Ashley Hinson, a Republican representing the state’s 1st District, disagreed. She wrote that businesses were struggling to find workers.

“This is because the government is paying people to stay home instead of work — this is a huge issue and barrier to long-term economic growth,” Hinson said.