LOUISVILLE, Ky. (WDRB) -- Gov. Andy Beshear plans to unveil a “bonus” incentive for Kentuckians receiving unemployment benefits to go back to work, taking a cue from other states that have created similar programs.
Beshear, a Democrat, faces pressure from Republicans and some employers to end federal jobless benefits in Kentucky — especially the $300 per week added to every unemployment payment — before they expire nationally on Sept. 6.
Beshear has resisted those calls, saying Kentuckians use the benefits to buy groceries and other necessities, which infuses $34 million a week in federal money into the state’s economy.
At the same time, “We’ve got to have people back in the workforce, and it can’t wait until September,” Beshear said.
“What we’re looking at is, bonuses upfront, or after a certain period of time, if you’re on pandemic unemployment (for) coming back into the workforce,” Beshear told WDRB News in an interview Friday. “We’ve seen some other states do it. We think that there’s some good things they’re doing, and some bad things they’re doing.”
Beshear said the details of the program would be finalized this week or next.
His office would not elaborate on how the program would work.
“The Governor and his administration continue to work with the business community to develop a program to incentivize Kentuckians to return to work while trying to minimize the loss of the $34 million in economic impact, particularly to retailers and grocers,” spokesman Sebastian Kitchen said in an email Wednesday. “The Governor will announce details once they are finalized.”
In Arizona, Republican Gov. Doug Ducey announced his state would stop taking the federal jobless benefits in July, instead offering up to $2,000 to people who stop claiming unemployment benefits and complete 10 weeks of work.
In Connecticut, Democratic Gov. Ned Lamont is continuing the state’s participation in the federal benefits programs while also offering $1,000 for long-term unemployed people who complete eight consecutive weeks of fulltime work.
Business groups say a return-to-work incentive could help ease a “workforce shortage” that has companies offering their own short-term bonuses to lure new hires. Even so, they continue to call on Beshear to end the federal benefits.
Louisville’s chamber of commerce, Greater Louisville Inc., “supports all efforts to get our community back to work, including a return-to-work incentive, to aid in the transition back to the workforce,” CEO Sarah Davasher-Wisdom said in a statement.
But the group continues to “strongly urge the Beshear administration to opt out” of the $300 weekly supplement to unemployment checks.
The Kentucky Chamber of Commerce asked Beshear last month to eliminate the federal benefit that provides the additional $300 per week, saying a person who gets the average state benefit of $365 per week receives the equivalent of $17 per hour in jobless benefits.
“Employers are doing everything they can to meet rising demands with limited workforces, including increased pay, asking employees to work longer hours, and scaling back operations. It is a real and serious problem,” the organization wrote to Beshear.
Ashli Watts, CEO of the Kentucky Chamber, told WDRB News that the other federal programs – which allow people to receive benefits for an extended term and provide benefits to those who wouldn’t otherwise qualify, such as the self-employed – have outlived their usefulness.
“It is really time to get people back to work and that does mean phasing out some of those benefits,” she said.
Twenty-five states, all with Republican governors, have announced an early end to their participation in at least one of the federal jobless benefits programs before Sept. 6, according to CNBC.
That includes Kentucky border states Indiana, Ohio, West Virginia and Missouri.
Watts said a return-to-work bonus is an idea "worth exploring."
"There is no data around any of this," she told WDRB. "This is a new problem, and so we're right in the middle of getting people back to work after the pandemic. So, it's almost like an 'all hands on deck' approach."
Kentucky Agriculture Commissioner Ryan Quarles, a potential Republican challenger to Beshear in 2023, has called for a "back to work bonus."
I'm renewing my call for Gov. Beshear to end participation in the federal pandemic unemployment assistance program. While I’m no fan of gov't payments, I propose a back-to-work bonus to encourage people to reenter the workforce, instead of sitting at home. https://t.co/J9h9Ee0HKR— Commissioner Ryan Quarles (@KYAgCommish) May 27, 2021
‘Punished for being unemployed’
Debra Hodge, a 57-year-old grandmother who lives in Louisville’s Newburg neighborhood, has been claiming unemployment benefits since August, when her company lost a client and laid her off.
She staffed a phone line helping patients interpret their medical bills, she said.
Like thousands of Kentuckians, her unemployment claim ran into administrative problems this year. In April, she stopped receiving payments. She doesn’t know why her claim was marked for “fact finding,” and even after she snagged an in-person appointment in May — no easy feat — it didn’t fix the problem.
With her age and her chronic obstructive pulmonary disease (COPD), Hodge said she can’t do a warehouse or fast-food job. She wants something office or customer-service related, like the job she had for nine years before last year’s layoff.
And with her blind daughter and grandchild living in her household, she needs health insurance benefits and a “good wage,” which she said would be about $18 an hour.
“It’s not that I don’t want to get a job,” she said. “I can’t just go to McDonald’s. I can’t afford that.”
Hodge said between Kentucky’s failure to pay jobless benefits reliably and calls to end the benefits, “It feels like we are punished for being unemployed.”
Hodge said she’d like to see the details Beshear’s return-to-work incentive, but she doesn’t trust that it would be paid on time without an administrative hiccup. “Not after what I have been through,” she said.
Jason Bailey, executive director of the Kentucky Center for Economic Policy, a liberal group that urges Beshear to keep the federal jobless benefits in place, said he doubts a return-to-work incentive is “actually needed.”
Kentucky’s economy is snapping back after losing a lot of jobs during the pandemic recession, and the labor shortage is a “problem that is sorting itself out,” he said.
A return-to-work bonus, Bailey said, “reinforces a narrative about people not willing to work that just doesn’t align with the actual facts … The whole issue has been overblown. People are returning to work in very large numbers.”