Lawmakers, governor make deal to end controversial extra unemployment benefit
UPDATE: Governor John Bel Edwards announced Wednesday that he signed the legislation into law.
This is a breaking update. Read the original story below.
BATON ROUGE - The governor appears ready to end the controversial extra unemployment assistance after lawmakers agreed to increase the state's regular unemployment assistance.
Louisiana will end the $300/week enhanced unemployment benefit at the end of July, just a month before it was scheduled to expire, in exchange for the increase.
Business and industry leaders have complained the weekly stipend on top of regular unemployment benefits has prohibited people from accepting open jobs in the post-pandemic re-opening of most businesses.
It appears a last-minute deal was worked out between lawmakers and the governor to permanently increase the state's regular jobless benefits by $28/week, beginning in January.
Right now, the maximum benefits an unemployed worker in Louisiana can receive is $247/week. That figure is among the lowest in the nation.
The regular benefits would increase only if the state stops accepting the COVID-era enhanced benefits of $300 by July 31. The assistance was originally scheduled to end September 6.
Louisiana hired economist Jim Richardson to study the impact of ending the federal assistance. Richardson was expected to be paid $31,000 to look into the unemployment situation and other "economic industry forecasting" for the state unemployment office.
The governor has said his concern over ending the extra unemployment benefit is tied to hospitality workers who are still not back to work since some travel-related businesses have not bounced back fully in the wake of COVID closures.
At his post-session press conference Thursday evening, the governor addressed the compromise.
"For a long time now, Louisiana has had the smallest weekly benefit in the country," Edwards said. "We just need to do better than that. This is one way towards advancing that goal as well. Everything's a trade off. Reasonable people can disagree on where you draw the line.
Edwards says he and workforce officials have been discussing an August cutoff date for federal unemployment, although it's unclear if that option had been revealed publicly before Thursday.
"When kids go back to school, parents have more of an opportunity to go back to work without having to worry about childcare," Edwards said. "That was really always the reason for picking August as opposed to September.
As lawmakers mulled the compromise, not everyone was on board.
"I just kind of can't believe you're doing this, turning down federal money for people who had the hardest year of your life," Rep. Mandie Landry, a New Orleans democrat said. "I think it's based on junk science and no data, and I wish you would rethink it."
Last week, the Baton Rouge Area Chamber said it asked state leaders to end participation in the enhancement program before it’s scheduled to end in September.
“The federal unemployment enhancement made sense when government mandated business shutdowns that left hundreds of thousands of Louisiana residents without the opportunity to work. Since virtually all COVID restrictions have now been lifted, and there is incredible demand for labor, there’s diminishing justification for continuing a program that disincentivizes residents from seeking employment,” said Andrew Fitzgerald, BRAC’s senior director of business intelligence. “The weekly payment, combined with state unemployment assistance, is currently the equivalent of almost $14 per hour, which is nearly median individual income in the state. In other words, one can be in the middle of the pack in terms of earnings by not working.”
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