Virus-Outbreak-Unemployment-Benefit

Passersby walk past a hiring sign as they enter a Target store, Sept. 30, 2020, in Westwood, Mass.

(The Center Square) – With September came the end of the federal unemployment supplement, which has many Massachusetts employers hoping to see an uptick in workers returning to the labor market.

Approximately 304,000 Massachusetts residents lost $300 in weekly federal unemployment benefits on Sept. 4, according to the Boston Herald.

Christopher Carlozzi, Massachusetts director for the National Federation of Independent Business, said it’s been an ongoing struggle for businesses to bring workers back.

“Now that the supplemental benefit is ending, I do think there is hope that they’re going to see people return to the workforce,” Carlozzi told The Center Square.

The Bay State implemented a job search requirement for recipients to keep collecting unemployment back in June, the Herald reported.

But businesses are still struggling.

“When you start to break down by industry, you’re seeing retail shops, restaurants – a lot of service industry – where they have those help wanted signs on the doors and windows, and it has been there for some time,” Carlozzi said.

As of July, Massachusetts’ unemployment rate was below the national level at 4.9%, according to Carlozzi. But there is evidence to indicate it is not evenly divided among industries, the Herald reported.

Employment for those earning above $60,000 only saw a 2% drop last year, while those earning below the $27,000 level experienced 29% higher unemployment, according to a study by Opportunity Insights out of Harvard, as reported by the Herald.

Unemployment is also divided along racial lines with a rate of 12.5% for Latinos, and 11.1% for black Massachusetts residents, the article stated.

Right now, small businesses need customers, Carlozzi said, but it’s hard to attract them when the service experience is poor from a lack of staff.

“If you are a restaurant or a retail shop and you don’t have enough servers or clerks working registers, and you have consumers having that negative experience because perhaps the line is too long or the wait for their food takes too much time, that’s not the type of experience a business wants a customer to have,” he said.

Compounding small businesses’ problems are greater costs of doing business, including higher unemployment insurance tax rates inflated by this situation, Carlozzi said.

Massachusetts has a $7 billion unemployment fund deficit.

“You do have a lot of small business owners scratching their heads saying, ‘I’m really having a hard time filling this position that’s been open for a substantial amount of time and yet we still have a significant part of the population collecting unemployment benefits – and on top of that, as the business owner, I have to pay higher payroll UI taxes because of this scenario,” he said.