May 12, 2021 - Economy & Business

Tennessee governor orders end to federal COVID unemployment benefits

Bill Lee
Gov. Bill Lee. Photo: Houston Cofield/Bloomberg via Getty Images

Tennessee Gov. Bill Lee (R) announced Tuesday that his state will withdraw from federally funded pandemic unemployment benefits on July 3.

Why it matters: Tennessee joins a growing list of states with Republican governors that are turning down the federal benefits citing worker shortages. Some experts say, however, it's the job climate and not unemployment benefits that is determining when and how people return to work.

The big picture: Iowa Gov. Kim Reynolds (R) also announced Tuesday an end to the state's benefits program.

  • Alabama Gov. Kay Ivey (R) ordered a stop to the benefits on Monday.
  • Last week, South Carolina Gov. Henry McMaster (R) and Montana Gov. Greg Gianforte (R) did the same.

The end to the benefits means that unemployed Tennesseans will no longer receive weekly $300 payments, benefits for non-traditional workers (such as gig workers or those who are self-employed), or an extension of benefits.

What they're saying: “We will no longer participate in federal pandemic unemployment programs because Tennesseans have access to more than 250,000 jobs in our state,” Lee said in the press release.

  • “Families, businesses and our economy thrive when we focus on meaningful employment and move on from short-term, federal fixes.”

Our thought bubble, via Axios' Courtenay Brown: "The floodgates are open. While policymakers and economists spar over whether generous jobless benefits are keeping would-be workers at home, more and more states are moving ahead to cut them off."

Go deeper: States enter the unemployment fray

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