ELLICOTTVILLE – State Senator George Borrello is taking a stand against labor shortages he says is caused by the extended unemployment benefits in New York.
Borrello, speaking during a press conference in Ellicottville Friday afternoon, proposed a possible fix to the problem announcing new legislation that would withdraw New York State from the enhanced benefit portion of the program, which provides claimants with an extra $300 per week in addition to the standard state benefit.
“After the challenges and losses of the past year, small businesses have been anxiously awaiting the day when they could move beyond the pandemic and resume full operations,” said Borrello. “What they didn’t anticipate was the magnitude of the labor shortage they would face and that their competition would come, not from other employers, but from enhanced unemployment benefit checks.”
Borrello was joined by small business owners from the manufacturing and restaurant sectors who shared the hiring difficulties they’ve encountered.
“While I recognize that there are multiple reasons for the current labor shortage, the enhanced unemployment benefits are certainly a significant factor,” said Peter Kreinheder, Founder and Managing Member of the Ellicottville Brewing Company. “We have great, hardworking employees at our restaurants and they have been terrific at picking up the slack caused by the labor shortage. However, unless things improve, we are going to have to adjust our expectations for the summer season downward.”
Withdrawal from the program, Borrello says, would simply return benefits to their pre-pandemic state rate, which is dependent on income, but averages about $350 per week, with the maximum benefit capped at $504 per week.
“Based on analysis from the U.S. Chamber of Commerce, one in four recipients is receiving more on unemployment than they earned working,” furthered Borrello. “It is just common sense to conclude that it is disincentivizing people from returning to the workforce.”
He says New York isn’t alone in experiencing an unemployment-benefit driven labor shortage.
Following April’s dismal jobs report, more than 20 states have announced they will end their states’ participation in the supplemental unemployment benefits program within the next month and a half, well before the scheduled September 6 expiration of the extra benefit.