Unemployment benefits end, will employers start to see more applicants? Local economist weighs in on the labor shortage

MISHAWAKA, Ind. -- As of Monday, 8.9 million Americans lost their weekly unemployment benefit payments and 2.1 million people lost that 300 dollars per week from federal payments too.

Many employers are now hopeful they’ll be able to start filling job vacancies that have been open for a while but economists are doubting about that return.

“This was the biggest short-term economic shock in US history,” said Dr. Michael Hicks, who is the Director of Center for Business and Economic Research at Ball State University.

Lawmakers believed that more Americans would return to the workforce after COVID-19 vaccinations started to ramp up but local businesses like Chicory Cafe in Mishawaka say they have not seen an increase in applicants even since the lift of unemployment benefits.

“In the restaurant world, it seemed like someone was applying every day in this world before COVID. You know we were hiring every week and the pandemic put a big halt to the applications. I don’t know if people felt nervous in this industry… or just getting different jobs and trying to get out of the workforce here in the restaurant industry,” Morauski said.

Dr. Hicks says data shows that there is zero correlation between job growth and people benefiting from unemployment.

“The 26 states that eliminated the pandemic unemployment assistance, and the 24 that did not, those that lifted unemployment insurance actually performed worse,” Dr. Hicks said.

Dr. Hicks says Congress set the unemployment disbursement at a certain dollar to keep families surviving during the pandemic while not disrupting the labor shortage.

He says the virus is the reason businesses have struggled to fill job vacancies, especially when most of the world began working and going to school remotely.

“I'm better off, my family is happier, my lifestyle is better, I spend more time with my kids now without taking that job so that explains a portion of the job decline participation,” Dr. Hicks said.

A local Michiana resident Mark Schubert added that many people who stayed home during the pandemic realized that there’s more to life than an 8 to 5 schedule.

“We have had a vaccine for 10-11 months and still half of Hoosiers haven’t taken it. Until we get the virus under control, we face a slowing stagnant economy,” Dr. Hicks said.

“A lot of more people would be interested in going back to work if we had more masking and more people getting shots,” said Shubert.

Experts say many are fearful of contracting COVID-19 and risking their lives for a paycheck that barely pays the bills.

Others, realize there’s more than just a 9-5 job, or prefer remote working since it’s more convenient for their family, taking into consideration child care and expenses.