EDITOR’S NOTE: This story was updated to reflect clarification of benefits from Georgia Labor Commissioner Mark Butler.
Governor Brian Kemp says it’s time for Georgians to get back to work. On Thursday he announced that the state will end federal unemployment benefits included in the Biden administration’s COVID-19 legislation, money that Kemp says is standing in the way of economic recovery.
Kemp’s decision comes after a wave of Republican-led states announced similar moves, citing complaints from local businesses that say they can’t return to pre-pandemic productivity because they can’t find willing workers. Despite statistics showing Georgia is near full employment, the state Chamber of Commerce calls the current business climate a “crisis” caused by federal worker benefits.
State goes against elected senators’ votes
The difference between Georgia and those other states – which include South Carolina, Montana, Alabama and at least seven more – is that Georgia’s two senators voted for the American Rescue Plan. The law passed this spring gave billions of dollars in federal aid to businesses of all sizes and included provisions for $300 per week in unemployment benefits for millions of American workers, including gig economy, self-employed and part-time workers who have no access to state unemployment insurance in Georgia.
In an interview Thursday with The Current, Senator Raphael Warnock called Kemp’s announcement “bad public policy.” The Savannah-born preacher, who cast one of the crucial votes to pass the American Rescue Act, says Kemp’s decision will hurt tens of thousands of Georgian families who lost jobs last year through no fault of their own and have no access to childcare, affordable transportation that are crucial to working outside the home.
“While we are starting to claw our way out of this pandemic we are not out of the woods yet and I think that it’s unfortunate that just as Georgians are getting back on their feet that the governor thinks it’s a good move to pull the carpet out from under them. I think that’s bad public policy,” Warnock said.
Unemployment data shows disparities
A deeper analysis into Georgia’s unemployment statistics, which is currently at 4.5%, show that economic disparities and challenges have widened during the pandemic, leaving many working families struggling to return to the job market. Indications are that this is not down to federal unemployment funds but by rising costs of health and child care and extra burdens posed by COVID-19. For those eager to regain jobs, economic opportunity isn’t as robust as Republican state leaders and some businesses say.
Georgia’s unemployment rate is at a level that economists call “full employment,” a situation whereby everyone willing to work at the going wage rate is able to get a job. If jobs are still available, according to economic theory, employers would have to rise to attract workers, thus triggering inflation.
Georgia businesses have more than 251,000 open jobs, and Kemp says they have been pounding on his door saying they can’t find workers to fill open positions. Business groups, including the state Chamber of Commerce blame enhanced federal unemployment funds for this imbalance because they say the extra benefit provides workers more money to stay home than by getting a job. The math they often cite is the maximum state unemployment benefit of $365 plus the current federal benefit of $300, which would theoretically provide unemployed workers $665 per week, or the equivalent of $16.62 per hour.
However, the majority of Georgians filing for unemployment aren’t receiving anywhere near that amount each week, according to Department of Labor statistics.
Self-employed, gig workers also lose benefits
At the end of 2020, approximately 80% of all Georgians who were receiving unemployment benefits were gig workers and self-employed workers who are not eligible for state unemployment funds.
While last year the federally enhanced unemployment benefits started at $600 per week, they dropped to $400 per week earlier this year. The American Rescue Plan allows for $300 in weekly federal unemployment benefits for workers between mid-March and mid-September.
Labor Commission Mark Butler says that the average recipient of unemployment in Georgia is receiving $14 per hour in federal enhanced benefits, $260 from the Pandemic Unemployment Assistance program, which started under the Trump administration, plus the extra $300 from the American Rescue Plan, which is the Biden administration’s spending legislation passed this spring.
Data is not available for March or April to show what percentage of Georgians receiving unemployment benefits are gig workers or self-employed. Ray Khalfani, an analyst at Georgia’s Budget and Policy Institute in Atlanta estimates that 50% of the people filing for unemployment this spring are from those sectors. “Federal money is the only safety net that they have,” he says.
Open jobs not available everywhere, for everyone
Meanwhile, economic opportunity is unevenly spread around the state.
Searches conducted Thursday among job listings on the state’s Employ Georgia site that matches employers to workers, only 200 of the 251,000 jobs posted were located within 50 miles of Savannah and 200 jobs within 50 miles of Brunswick. The job listings ranged from FedEx courier, to landscaper to engineer for Gulfstream.
None of the listings appeared to be for gig workers.
Although Kemp described his announcement Thursday as a “economic recovery plan,” it was unclear how his administration would address the structural challenges facing many out of work people of color and women, groups who have faced greatest threats from COVID-19.
Nearly 20,000 Georgians have died of COVID-19 related causes. Vaccination rates remain under 30% in the state. And many schools are not yet reopened — all of which are factors causing headaches for working families and keeping people from re-entered the job market.
From February 2020 to March 2021, employment for Georgia men has had a net growth of 5%, while women experienced a net decline of 2%. These gaps illustrate a larger trend of women exiting the workforce during the COVID pandemic.
In April, Black Georgians filed 54% more unemployment than white workers.
Hispanic and Black women have experienced at least 15% underemployment since the pandemic, while underemployment for Black men was 18% in the first quarter of 2021, more than any other group in Georgia’s workforce.
Warnock says these inequalities are why he supported extra unemployment benefits for workers in the American Rescue Act. Now, at the federal level, he and other Democrats are working to shore up protections for families and working mothers through two other pieces of legislation that are still being debated in Congress. One of these, the American Families Act, he says, should help these workers afford and find childcare, as well as help children get back to in-person learning.
Republicans, however, have criticized these large draft spending bills as wasteful.
Kemp’s statement alluded to the problems facing low- and middle-income working families in Georgia in relation to the availability and affordability of childcare. It said that over the next several weeks state officials will provide resources for job search support, education and training opportunities, childcare and transportation services, and safe workplace initiatives for workers, families, and employers.
But the statement provided no guidance on how the governor would accomplish this.