Federal unemployment benefits end today. What does that mean for Iowans?

By: - June 12, 2021 8:00 am

The solution to Iowa’s worker shortage isn’t cutting off pandemic-related unemployment assistance. (Photo by Tim Mossholder via Unsplash)

James Kennedy, a Mount Vernon musician, said the end of Iowa’s federal unemployment benefits feels almost like “blackmail.”

“This decision … to withdraw literally forces people to go back to work in a very unsafe environment,” Kennedy said. “I find that very life-threatening.” 

Kennedy and his wife, Catherine Lawson-Kennedy, lead the Heart Consort Music group. Before the pandemic, they taught music lessons to nearly 30 students, performed concerts several times a month and rented out a recording studio to local artists.

Catherine Lawson-Kennedy and James Kennedy, front, sit with their bandmates. (Photo courtesy of James Kennedy)

That all came to a sudden halt in March 2020. Aside from a few sporadic Zoom lessons, the Kennedys put their business on hold and filed for unemployment. They received state unemployment insurance and additional funds through federal programs.

“There was enough to keep us stable,” Kennedy said. “Pay the mortgage, put food on the table, take care of the majority of the bills. We still had to use some of our own savings to balance all of that out, but it did help.”

Beginning today, June 12, the Kennedys and other Iowans receiving unemployment will no longer receive additional federal benefits. Gov. Kim Reynolds announced in May that she would discontinue Iowa’s participation in the federal program in an effort to bring unemployed Iowans back to work. 

Reynolds defended the decision to end the benefits at a Wednesday conference for the Iowa Association of Business and Industry. She stood at a podium in the front of the room, her voice echoing over a catered lunch service.

“Almost every business owner I talk to, small, medium, large, in every sector, without fail, tells me they’ve had trouble getting people to show up,” Reynolds said. “And that’s why I made the decision to end Iowa’s participation in federal $300 weekly supplemental unemployment benefits.”

The ABI conference-goers applauded.

“Today, we have more job openings than we have people on unemployment,” she continued. “So why would we allow the federal government to hamper our economic recovery by paying potential workers to stay home?”

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

According to a Thursday release from the Department of Labor, over 30,000 Iowans filed for federal unemployment benefits in the week ending in May 22. 

Business leaders, struggling with worker shortages, have lauded the change.

“Imagine the frustration of operators ready to welcome patrons back, only to find that the people we need by our sides to serve, prepare food and beverage, and help in our establishments are opting to sit the summer out because they are being paid to do so,” said Iowa Restaurant Association President Jessica Dunker in a May news release. A survey by the Iowa Restaurant Association found that 90% of operators said “enhanced unemployment” was a reason for the industry’s worker shortage.

Iowa is one of 25 states to end the federal benefits before September, when they were scheduled to expire. President Joe Biden in early June defended his Sept. 6 deadline for the program, but his press secretary acknowledged that states have the power to withdraw from the program whenever governors decide to do so.

Iowa Democrats have opposed the change, arguing it burdens Iowans who might be unable to return to work. Sen. Zach Wahls, D-Coralville, has called for more support for unemployed Iowans, rather than less. Rep. Todd Prichard, D-Charles City, predicted in May that the removal of additional benefits would slow the state’s economic recovery.

“It has real consequences for Iowa families who are behind on rent, trying to put food on the table, pay for child care, and get their lives back to normal,” Prichard said then.

Even before today’s benefits deadline, Iowa was recovering more quickly than other states. 

WalletHub reported Tuesday that Iowa had seen the fastest overall recovery from the pandemic. The study measured recovery through three scores: COVID health (determined by vaccination and positivity rates), leisure and travel (based on visits to restaurants and parks and current gathering restrictions), and the economy and labor market (measured by unemployment rate, consumer spending, small business health and real estate listings).

“The emergency is over, and Iowa is coming back strong,” Reynolds told the ABI conference, emphasizing that the COVID-19 pandemic was in the “past-tense.” 

The Kennedys disagree. Though both James and Catherine have been fully vaccinated, they’re not yet comfortable doing indoor, private lessons, much less indoor concerts while fewer than half of Iowans are fully vaccinated

Lawson-Kennedy said she had been virtually teaching a student who wanted to begin in-person lessons — but he refused to get the vaccine.

“I’d like to see him get vaccinated, I’d love to teach him in person, but I can’t sit in judgement on him, either,” she said. “It’s not my place.”

The Kennedys had anticipated a return to business in September, when the federal benefits were originally set to expire and when more of the state would be vaccinated. With the benefits ending early, Lawson-Kennedy is considering offering string classes outside this summer, weather-permitting. 

“I think there’s a lot of people besides us who are sitting around, looking at the ceilings of their houses and wondering, ‘What the hell are we going to do?’,” Kennedy said. “A lot of people are in a real bind.”

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Katie Akin
Katie Akin

Reporter Katie Akin began her career as an intern at PolitiFact, debunking viral fake news and fact-checking state and national politicians. She moved to Iowa in 2019 for a politics internship at the Des Moines Register, where she assisted with Iowa Caucus coverage, multimedia projects and the Register’s Iowa Poll. She became the Register’s retail reporter in early 2020, chronicling the impact of the COVID-19 pandemic on Central Iowa’s restaurants and retailers.