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Employers hope for more applicants as federal unemployment benefits expire

Updated: Jun. 7, 2021 at 8:33 PM EDT
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COLUMBIA, S.C. (WIS) - Many business owners that have posted “Help Wanted” signs in recent months say they have not seen as many applications come in as usual.

They believe the main reason for the lack of staff and potential workers is due to the increased unemployment benefits people have received in the past year from federal pandemic funds.

Gov. Henry McMaster announced in May that federal funds would expire at the end of June.

Those federal funds that allow South Carolina residents to receive, at most, $300 extra per week in addition to state benefits oftentimes adds up to more income than people would make while working, says Carolina Café owner Lauren Schlueter.

“I think it’s because people are making more money staying home and with being a small business, you know, I’m not paying anybody $600 or $700 a week,” she said. “So that’s been a real issue.”

Research economist at the Darla Moore School of Business, Joey Von Nessen, says that the ending of federal unemployment funds will have more impact on employment rates for service industry jobs.

“Industries that are hiring at wage rates that are at or below $16 an hour are the ones that are likely to benefit most from the end of this federal supplement because that will draw people back into the labor force, and that’s primarily the service, leisure, and hospitality sectors,” he said.

In contrast, Von Nessen says that jobs that require skilled labor and pay higher rates will not see as much of a change from the withdrawal of federal benefits.

Brian Nottingham, Director of Labor Market Information at the SC Department of Employment and Workforce, says that the purpose of ending federal benefits is to get people back into the workforce.

“From a straightforward common-sense perspective -- at least that’s the goal, of course, to encourage folks to rejoin the labor force,” Nottingham said. “And to help our employers as it’s the busiest time of year for a lot of them.”

Nottingham encourages those relying on federal unemployment benefits to begin applying to jobs now.

“If they get a jump on looking for the jobs they need right now while they’re still waiting for the other 60,000 people’s benefits to end, you’re going to be way ahead,” he said. “It’s much better than to be looking for that job before the competition is fierce.”

DEW reports that unemployment rates in South Carolina are better than much of the country -- as the last report indicates a 5.1% unemployment rate. Nottingham says a healthy unemployment rate is around 4%.

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