Sep 16, 2021 - Politics

Ending unemployment benefits had little impact on Arkansas job growth

Total nonfarm employees in Arkansas
Data: Bureau of Labor Statistics; Chart: Danielle Alberti/Axios

States that ended supplemental unemployment benefits early had similar job growth compared to those that continued aid, according to a recent Wall Street Journal analysis.

Why it matters: It suggests the extra $300 a week was not a primary factor keeping unemployed Arkansans from returning to work this last year.

Context: Gov. Asa Hutchinson directed the state in May to end the program over the summer, citing worker shortages.

By the numbers: Nonfarm payrolls (jobs excluding farm workers) rose 1.33% in July from April for states that ended the benefits.

  • They rose 1.37% for states that continued benefits through Sept. 6, the Wall Street Journal analysis shows.
  • The analysis compares July to April because states started announcing an end to the benefits in May.

Yes, but: While the $300 doesn't appear to be the primary reason people remained unemployed, that doesn't mean it had zero influence. There were small upticks in employment once states stopped the extra aid.

  • In Arkansas, unemployment was down — but only slightly — from 4.4% in May to 4.3% in July.

The big picture: There are several factors driving continued unemployment.

  • A July poll cited childcare needs as the No. 1 reason for turning down a job offer while unemployed. COVID-19 fears, health or medical limitations and unemployment benefits are all tied as No. 2.

The bottom line: The government released a study this week showing the U.S. poverty rate dropped to 9.1% in 2020. In part, that's due to pandemic-related stimulus money.

  • The stimulus lifted nearly 12 million Americans out of poverty, while expanded unemployment benefits lifted over 5 million, writes Axios' Courtenay Brown.

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