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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

Go deeper

Alabama governor orders end to federal COVID unemployment benefits

Alabama Gov. Kay Ivey. Photo: Michael Wade/Icon Sportswire via Getty Images

Alabama Gov. Kay Ivey (R) on Monday ordered the state to terminate all participation in federally funded pandemic unemployment compensation programs.

Why it matters: Ivey, like South Carolina Gov. Henry McMaster (R), cited labor shortages, but some experts say it's the job climate and not unemployment benefits that is determining people's return to work.

Linh Ta, author of Des Moines
May 11, 2021 - Axios Des Moines

Iowa governor to end federal pandemic unemployment aid

Data: U.S. Bureau of Labor Statistics; Chart: Axios Visuals

Gov. Kim Reynolds (R) announced this morning that Iowa is joining a group of red states that are ending the federal government's pandemic unemployment aid — including the supplemental $300 per week — June 12, months before it sunsets in September.

Why it matters: The federal supplement is meant to keep Americans afloat after a year of enormous financial hardships and job losses. But with the economy on the verge of reopening, employers say they're struggling to find enough workers to fill open jobs.

Linh Ta, author of Des Moines
May 11, 2021 - Axios Des Moines

Iowa struggles with worker shortage despite uptick in unemployment

Illustration: Brendan Lynch/Axios

There's no doubt you've stumbled across a "Now Hiring" sign at the drive-thru or grocery store.

  • Like the rest of the U.S., Iowa employers say there's a shortage of available employees in industries like construction and hospitality as the economy picks back up.

Why it matters: The inability to fill open jobs has an immediate impact on our everyday lives, like long waits at our favorite restaurants.

  • Long-term though, it slows our economic recovery and stifles business expansions.