SALT LAKE CITY — Governor Spencer Cox has decided to end Utah's participation in increased federal unemployment benefits tied to the pandemic.
The governor's office said the $300 weekly stimulus payment, as well as other federal unemployment programs specifically tied to the pandemic, will end June 26. That impacts approximately 28,000 people and about $12.8 million is paid out per week.
"Utah has the strongest economy in the nation," Gov. Cox said during a town hall posted on his Facebook, later adding: "I just philosophically don’t believe government should be competing with private sector to keep people out of the workforce."
Nine other Republican governors across the country have done similar. Wyoming Governor Mark Gordon announced on Tuesday that his state would end its participation.
Utah has one of the lowest unemployment rates in the United States at 2.9%, compared to 6% nationally with approximately 46,600 people considered unemployed. Recently, service industry businesses have struggled to find employees as COVID-19 restrictions loosen and people venture out to restaurants and bars.
The move was praised by the state's largest business organization, the Salt Lake Chamber.
"All across Utah, in a variety of industries, we are seeing the significant need for new employees," said Chamber CEO Derek Miller in a statement. "The challenge our economy currently faces is not the scarcity of well-paying jobs, but the lack of workers. For our state to remain a national economic leader and for our communities to be prosperous, we need to normalize the labor market by assisting those currently unemployed to find opportunities to rejoin the workforce as soon as possible."
However, advocates for the working poor point out that it's not an issue of work — but wages that are not keeping up with the cost of rent, utilities and other needs.
"It is about income," said Gina Cornia, the executive director of the nonprofit group Utahns Against Hunger. "Families need cash to pay their rent, to pay their car note, to pay their health insurance, their car insurance, gas."
Cornia said Utah families are being offered jobs with wages that don't allow them to afford monthly rents, which have skyrocketed. They have also been forced to turn to state benefits for child care and food.
"If they’re making more on unemployment than they are in a job, then maybe it’s time to end the enhancement of the federal benefits, but a time to talk about income disparity and what it takes for families to afford a very basic standard of living," she said.
Kevin Burt, the deputy director of Utah's Department of Workforce Services, said it is likely employers will need to start raising wages in order to hire.
"Now it’s up to the employers to compete for these employees," he said Wednesday. "So I don’t think this will resolve all of the employer concerns about not being able to find employees. One of the ways employers can respond is to increase wages."
But he said with Utah's economic situation the way it is, the state has decided this is the best way to move forward.
"We haven’t seen an increase in the number of people reporting people refusing work," Burt said. "And we do have to say this, we think this is a good change and a right step in the state of Utah."
Utah's Department of Workforce Services said it is still offering rent assistance, utility, food and medical bill relief at jobs.utah.gov.
"There are safety net programs but there are jobs available for these individuals to find that security and find that employment," Burt said.
After June 26, people on unemployment will still receive state benefits — at pre-pandemic levels. Utah law also requires those who are on unemployment to show that they are actively seeking work.