HARRISBURG – About 200,000 Pennsylvania workers got back to work in May, but that number might be higher if unemployed workers weren’t receiving a $600 a week boost to their jobless benefits, according to the National Federation of Independent Businesses.
Pennsylvania’s unemployment rate was down 3 percentage points over the month to 13.1 percent in May.
The national rate fell 1.4 percentage points from May to 13.3 percent.
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But small business owners across the state are struggling to recruit workers to return to the job, especially in low-paid positions where the $600 a week in extra jobless benefits makes it more lucrative to collect unemployment than earn a paycheck, said Gordon Denlinger, state director of the National Federation of Independent Businesses.
The stimulus-funded $600 boost in unemployment is scheduled to come to an end at the end of July, Susan Dickinson, director of unemployment policy for the Department of Labor and Industry said last week.
Dickinson and Secretary of Labor and Industry Jerry Oleksiak have repeatedly said that laid-off workers are expected to return to work if they are asked to come back.
Employers can notify the state that workers refused to return to work. Then the employee would have to justify to the Department of Labor and Industry why they refused to return to work.
“Without good cause,” a worker who refuses to return to work could be deemed ineligible for additional benefits, according to information from the Department of Labor and Industry.
“During the current COVID-19 pandemic, examples of good cause may include: an employer violates the Governor’s and Secretary of Health’s business closure orders and opens their business prematurely, or the person is at high risk of complications from the virus and their employer cannot make reasonable accommodations for them,” according to the Department of Labor and Industry.
Denlinger said that while employers can report workers who refuse to return to work, many don’t bother.
“When they are trying to get their businesses reopen, most of them will feel like they have better things to do,” Denlinger said.
Workers in low-paying jobs likely also recognize that there’s little real risk in refusing to go back to work because even if they do lose their benefits, they may expect they will be able to find another position with a different employer if they need to do so, he said.
“Unfortunately, the CARES Act has created a perverse incentive for workers to continue collecting unemployment insurance if they can be paid more not to work,” said NFIB’s federal government relations manager, Courtney Titus Brooks. “Small business owners should not be put in a position where they have to compete with unemployment insurance to reopen their doors.”
How many businesses have notified the Department of Labor and Industry that they’ve had former workers refuse to return to work wasn’t immediately clear on Friday, because state offices were closed for the Juneteenth holiday. The issue of people refusing to return to work can have a ripple effect in that workers who do return to work can become disgruntled over the apparent inequities.
“They might say, ‘I’m making less money than someone who is sitting at home watching TV,’” Denlinger said.
The controversy over workers facing the decision about whether to try to continue collecting benefits has accelerated as businesses across the state have begun to reopen.
Friday, Gov. Tom Wolf announced that by next Friday the entire state, except Lebanon County, will be in the green phase of the state’s reopening plan.
Lebanon County officials moved to reopen in defiance of the state and on Friday, Secretary of Health Dr. Rachel Levine said that move led to an increase of coronavirus cases in that county.
“Case counts have escalated and the county is not yet ready to be reopened. Lebanon County has hindered its progress by reopening too early,” she said.
Over the year, total nonfarm jobs in Pennsylvania were down 863,800 with declines in each of the 11 industry sectors. The largest volume 12-month change was a decline of 300,100 jobs in leisure & hospitality.
The biggest gain was in the construction industry, which added 77,000 jobs in May. But there were still 24,500 fewer construction jobs in May than there had been a year earlier.
Leisure and hospitality businesses added almost 39,000 jobs in May. But even as the state began to relax business restrictions in May, there were still less than half the number of people working in leisure and hospitality last month than there were a year earlier.
In May, there were 276,000 people employed in the leisure and hospitality industry, and there were 576,000 people employed in those sectors in May 2019, according to the state data.