Could government bonuses cure worker shortage?
A state lawmaker is hoping to sweeten the incentives for people to return to work, a subject that has spurred furious debate over the last several weeks.
- Rep. Jim Cox, a Republican who represents parts of Berks and Lancaster counties, wants to cut off the extra $300 in weekly jobless benefits currently available through the federal government.
- In its place, Cox proposes a federally funded bonus program for unemployed people who take new jobs and hold onto them.
Why is this happening: Businesses are struggling to find workers and many suspect that extra unemployment pay -- enacted as part of federal Covid relief -- is keeping people out of the workforce.
What are the options: Lawmakers have pushed to bring back a state requirement that people who are out of work look for new jobs as a condition of receiving unemployment benefits. The requirement was suspended in 2020 and the suspension has been extended this year.
- Some lower-wage, part-time workers can, in fact, earn more on unemployment right now, according to a recent report by Pennsylvania's Independent Fiscal Office.
- But other factors are at play, such as the cost of day care and the need to look after children who are not able to attend school.
- Other people may be weighing new career options after their previous jobs were eliminated -- or they are not yet fully vaccinated.
- Many businesses are offering higher wages and sign-on bonuses as an incentive, said Gene Barr, president and CEO of the Pennsylvania Chamber of Business and Industry.
- But in some cases, they are competing with the federal government, a situation he described as unfair.
- Some states, including Alabama, Iowa and South Carolina, have pulled out of the federal program offering extra jobless pay.
- Cox's legislation adds a new twist to the trend: paying people who find work.
- "As more and more Pennsylvanians are vaccinated or have developed natural immunity to Covid-19, there are far fewer restrictions on economic activity, and it is high time to get Pennsylvanians back to work," Cox wrote in a memo seeking support for his proposal.
How would it work: Cox's plan calls for using $154 million in federal Covid relief funds to pay a $300 bonus to former unemployment claimants who spend at least four weeks at a new job.
- People who work at least eight weeks qualify for a second $300 bonus.
- But the payoff isn't automatic. The bonus program would prioritize people who stopped collecting unemployment earlier, people working at least 35 hours per week and people who work eight weeks in a row.
- Barr did not discount the bonus concept.
- "We have to look at almost every option right now," Barr said. "This employment situation is so desperate that we've got to find ways to get people back."
Will it pass: Cox's legislation might make it through the GOP-controlled legislature. But it will hit a wall in the office of Gov. Tom Wolf, a Democrat
- In an emailed statement, Wolf spokesperson Lyndsay Kensinger wrote: "There is no evidence to support the false narrative that additional unemployment benefits [are] a primary factor in the perceived labor shortage."
WHO'S HIRING: The Harrisburg Regional Chamber and Capital Region Economic Development Corp. The organizations' boards have named Ryan Unger as their next president and CEO. He is slated to start July 1 and take over for David Black, who is retiring at the end of June after 20 years of leadership. Black announced his retirement toward the end of last year.
- Unger is currently president and CEO of Team Pennsylvania, a public-private partnership that works with companies that want to move into or expand in the state.
- He joined Team PA in 2011 as director of policy and programs and was named CEO in 2015.
- Before that, he worked for the SEDA-Council of Governments in Lewisburg and the Greater Susquehanna Valley Chamber of Commerce, based in Shamokin Dam.
The search: The chamber worked with recruiting firm Jorgenson Consulting and said it received more than 125 applications.
- "It was very clear to the Search Committee and all of us who know Ryan that his enthusiasm and expertise is just what we were looking for in the Chamber & CREDC’s new President & CEO," chamber chair Meron Yemane and CREDC chair Mike Funck wrote in a joint statement.
- The chamber and CREDC cover Cumberland, Dauphin and Perry counties.
WHO'S EXPANDING: West Shore Home. The Mechanicsburg-based home-remodeling company has leased space in Norristown to support operations in southeastern Pennsylvania and New Jersey. The 23,600-square-foot building includes offices, sales-training facilities and warehouse space. At full capacity, it will employ more than 100 people, according to West Shore Home spokesperson Kirsten Page.
- Founded in 2006, West Shore Home has 20 locations in 12 states, stretching from Pennsylvania south to Florida.
WHO'S GETTING A ROOM: Duck Donuts. The Cumberland County-based donut franchise has teamed up with a resort hotel in -- where else? -- the Outer Banks beach town of Duck, North Carolina, where Duck Donuts was born.
- Between May 28 and June 30, Sanderling Resort is offering a donut-festooned room as part of a vacation package dubbed The Sweet Escape.
- The package includes a morning delivery of Duck Donuts and a behind-the-scenes tour of the original Duck Donuts stores.
Got questions? Got feedback? Interested in supporting BizNewsPA?
Contact us at BizNewsPA@gmail.com
Compiled and written by Joel Berg