Arizona joins 12 GOP states in ending extra unemployment pay
Arizona Gov. Doug Ducey on Thursday joined a growing number of Republican governors who are stopping payment of an extra $300 per week in pay for unemployed workers paid for by a federal virus relief package to force people to return to work.
The governor’s action, which goes into effect July 10, means unemployed Arizonans will again get the second-lowest weekly pay in the nation: $240 per week. Ducey is continuing federally sponsored programs that extend the standard 26 weeks of pay by another 29 weeks and allow gig workers such as Uber drivers to qualify for unemployment pay, although those will also be reduced by $300 per week.
He is also throwing in a sweetener for people who decide to return to work: A $2,000 bonus paid to workers who get and keep a full-time job for at least 10 weeks. Part-time workers will get $1,000. Ducey is allocating $300 million in federal relief cash on a first-come, first-served basis to pay for the bonuses.
Ducey slashed unemployment checks by more than half despite celebrating the health of the state’s economy throughout the pandemic, noting the state shed fewer jobs than most. In Arizona, more people are employed now than before the pandemic, though the unemployment rate is also higher because the pool of jobseekers has grown.
“Although more people are ready to work today in Arizona than before the pandemic, many businesses are struggling to fill vital positions,” Ducey said in a statement. ”We cannot let unemployment benefits be a barrier to getting people back to work.”
Ducey’s move follows the lead of 12 other states led by Republican governors who acted in the past week and argued in ending the extra unemployment pay that it was providing an incentive for laid-off workers to stay off the job. It will affect about 32,000 people currently receiving regular unemployment and another 176,000 people enrolled in programs for the long-term unemployed and contract or gig workers, according to data from the state Department of Economic Security.
California Gov. Newsom’s economic recovery plan calls for $600 stimulus checks for eligible Californians. Families with children would get an additional $500.
Businesses have cited the extra $300 as a reason they are struggling to find workers, but there are other factors at play preventing people from returning to work. Some are worried about exposure to the coronavirus if they return to service sector jobs, according to government surveys, and many working mothers have left the workforce to care for children still attending school online.
Ducey aims to help those working mothers by providing childcare assistance for people who return to work but earn less than $25 per hour.
The proposal to deliver $8 billion in new cash payments to millions of Californians amid the COVID-19 pandemic is part of a $100-billion state budget that has swelled with a significant windfall of tax revenues.
Arizona’s unemployment soared after layoffs triggered by the pandemic last March. The state’s unemployment trust fund, which builds up cash during periods of low unemployment, was at $1.1 billion before the pandemic hit a year ago. It had fallen below $90 million in February, but Ducey used federal virus relief cash to boost the balance.
Ducey’s action Thursday came as the U.S. Labor Department said the number of Americans seeking unemployment benefits fell last week to 473,000, a new pandemic low and the latest evidence that fewer employers are cutting jobs as consumers ramp up spending and more businesses reopen.
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