Are unemployment benefits making it hard to find new hires?

May 7, 2021, 11:22 AM | Updated: 1:02 pm
Some local business owners say they’re having a hard time finding new hires and believe that unem...
Some local business owners say they’re having a hard time finding new hires and believe that unemployment benefits may be to blame. (AP Photo/Wilfredo Lee)
(AP Photo/Wilfredo Lee)

SALT LAKE CITY — Some local business owners say they’re having a hard time finding new hires and believe enhanced unemployment benefits may be partially to blame.

Where are the new hires? 

Those on unemployment are now eligible for an extra $300 per week until early September. That comes after the American Rescue Plan Act, passed by Congress in March.

Downtown bar and bistro owner Kirk Bengtzen says it’s flat out hard to compete with what unemployment is offering now.

“Holy cow… I mean, trying to get people to even show up to an interview is beyond ridiculous,” said Bengtzen, owner of Twist Bar Bistro.

Turning down offers to remain unemployed

Financial experts say it’s a calculated decision by many on unemployment to stay there. Simply put, they’re receiving more than many jobs can offer.

“Analysis shows that if someone is making $15 an hour or less, it’s more financially beneficial for them to stay on unemployment,” said Robert Spendlove, senior vice president and public-policy officer for Zions Bank.

Bengtzen says he’s seeing people make these decisions daily.

“Even people that do show up, they’re like, ‘Well, let me compare the money I’m making on unemployment with the money I would make with you,'” he said.

Many others aren’t even showing up. Bengtzen said he scheduled around two dozen interviews recently, although only four actually showed up.

Spendlove agreed that this is becoming a more widespread issue.

“It’s really constraining the ability of the labor market to expand and for employers to find people,” he said.

Officials with the Unemployment Insurance Division said they will investigate individuals turning down work to keep receiving weekly benefits. Businesses can submit a request for an investigation on the division’s website.

“Refusing work will disqualify individuals from unemployment insurance, and so it’s really important that people who are receiving it and employers who are offering jobs are aware of that and report any instances of it,” says Kevin Burt with the Department of Workforce Services. 

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Are unemployment benefits making it hard to find new hires?