Arkansas has joined the growing list of states who have opted out of the federal supplemental unemployment assistance. The supplemental federal assistance of $300 now ends for Arkansas on June 26.
Arkansas State Governor Hutchinson made the decision because Arkansas has a shortage of workers and he hopes lowering unemployment benefits will encourage people to return to work. In addition, the state’s economy has improved since the start of the pandemic.
Dr. Michael Pakko, chief economist at the Arkansas Economic Development Institute remarks that the situation is not as simple as it appears. “It makes sense we should be unwinding some of these extraordinary measures that we’ve been counting on to help people through the difficult times.”
Pakko said the supplemental unemployment money isn’t the sole reason for a worker shortage. Some people lack childcare while others still don’t feel safe returning to work.
Pakko said that as a result of the worker shortage, wages may go up. Employers may begin offering incentives to attract workers.
Read the original story on the ABC 7 website here.