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How some states are trying to get people back to work: Giving new hires bonuses of up to $1,200

Connecticut, Oklahoma and Montana are dangling an offer to persuade jobless workers collecting enhanced unemployment benefits during the pandemic to get back to work pronto: Cash bonuses for people who return to full-time jobs. 

Connecticut said on Monday it would award $1,000 to 10,000 jobless workers who find full-time work and hold the job for at least eight weeks. Oklahoma, meanwhile, said on Monday it would provide $1,200 bonuses to the first 20,000 currently jobless workers who find full-time jobs and hold them for at least six weeks. Montana earlier this month announced a similar initiative that will provide a $1,200 bonus to people who go back to work for at least four weeks.

The efforts come amid a wider debate over the job market as the U.S. economy continues to recover from the coronavirus pandemic. Restaurants and other businesses that are now reopening say they are struggling to find workers to fill their open roles, while some conservative lawmakers have pointed to April's disappointing jobs numbers as evidence that the extra $300 per-week jobless aid to help people get through the pandemic recession is keeping workers on the sidelines. 

That has prompted at least 19 Republican-led states to curtail the extra jobless aid months before it's due to expire in September, a move they say will help business owners who complain they can't find staff for open positions. Among those states are Oklahoma and Montana, which added retention bonuses to soften the impact of the reduced jobless aid, which will end June 26 for Oklahomans and June 27 for Montanans. 

"The biggest challenge facing Oklahoma businesses today is not reopening, it's finding employees," Governor Kevin Stitt said in a statement about the new program. 

Many economists and labor experts say the issue is more complicated than the extra benefit of $300 in weekly jobless aid. About 4 million people said they were sitting out of the job market because of concerns about getting or spreading COVID-19, according to a Census survey from April 14 to April 26.

Providing a bonus might help some workers who are transitioning from unemployment to the workforce, since there is often a gap between the end of jobless benefits and a worker's first paycheck, noted Andrew Stettner, an expert on unemployment insurance at the liberal-leaning Century Foundation. But providing a bonus to people who already have a job doesn't help those who remain unemployed, he noted. 

"I would think at best it's a complement to unemployment benefits to help people transition into work," Stettner said. "But as an alternative to unemployment, it's a pretty cruel joke to people."

Some workers may simply be biding their time until they find a job that they want to take. And many families continued to be hampered by a lack of childcare and remote schooling, which has made it more difficult for some parents — especially mothers — to return to full-time work.

"We have very generous unemployment insurance right now and what that means is people have the ability to wait for the right job to come along," Leo Feler, a senior economist at UCLA Anderson School of Management, told CBS Evening News. "Women have this greater responsibility for child caring and for home-schooling, and so that inhibits them from being able to go out and get jobs."

Changes in the labor force

The labor force also isn't what it was prior to the emergence of the novel coronavirus, according to a Bank of America report. It estimates that about 1.2 million people over 65 retired during the pandemic, while another 140,000 workers died from COVID-19. Another 700,000 people left the workforce because of a skills mismatch — meaning they don't have the education or skills that employers now want in their new hires, economist Joseph Song estimated. 

Song estimates about 1 million people are sitting out of the job market because of the extra jobless aid, most likely low-wage workers who are receiving more from unemployment than they did on the old job. The bottom line, he said, is that many of those workers are likely to return to work when the jobless benefits expire in September. 

The question now is whether the enticement of a one-time bonus will convince people who have concerns about COVID-19, or are dealing with childcare issues, to return to work. Connecticut said its bonus is aimed at helping people who have been out of work the longest find jobs by helping to cover the cost of searching for and starting a new job. The state has not ended the additional $300 weekly unemployment benefits paid for by the federal government.

"This pandemic disproportionately struck women, people of color, and low-income workers, and it happened almost overnight," Connecticut Labor Commissioner Kurt Westby said in a statement. 

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