About Those Jobless Benefits…

Rick Newman cites some evidence in his post at Yahoo/Finance that calls the notion that employers are having difficulty hiring due to overly generous jobless benefits into question:

Moody’s Analytics looked at four different sets of data, including weekly unemployment claims, Google mobility data, job search trends and small-business payrolls. There’s some evidence red states are recovering economically faster than blue states—but that has been the trend all year and hasn’t changed since red states began canceling jobless benefits. One reason may be that blue states tend to have more big cities that continue to struggle with residual Covid outbreaks, such as Los Angeles.

First-time claims for state-based unemployment insurance, for instance, fell 22% in blue states from May 2 through July 10, and 35% in red states during the same time period. That makes it seem as if employment has been recovering faster in red states as governors have been canceling federal jobless aid. But the gap between red and blue states was the same from February through May, before any Republican governors began killing benefits. So there’s been no change since the governors blocked those $300 weekly checks.

Job search firm Indeed found that search activity ticked upward after a few of the first Republican states announced they would be ending federal jobless aid. But that trend reversed, and last month Indeed reported that job-search activity in 12 GOP states that cut off jobless benefits was lower than it had been earlier in the year. “It is unclear why search activity is below the baseline in states where federal benefits have ended,” Indeed economist Jed Kolko wrote. “If overly generous federal UI benefits were holding back job seekers, then we would expect search activity to increase, relative to the national trend, in states where those benefits have ended.”

In 13 other states ending the benefits later, job-search activity was a bit above the national trend in late June. That may reverse, too, however.

Oxford Economics examined the income consequences for people losing jobless aid in red states, and found that about 1 million people will lose the $300 weekly benefit once cancellations have gone into effect in all red states. That represents about $1.2 billion in collective lost income per week. While not huge compared with the overall economy, it’s probably enough to offset anything gained from spurring people back to work. “Benefits discontinuation may end up doing more bad on the personal income ledger than good on the employment ledger of the economy,” chief US economist Gregory Daco wrote on July 14.

There are probably some people who are sitting out the job market because they make more in jobless aid than they would from working. But research has consistently found this to be a much smaller slice of the unemployed than Republicans typically acknowledge.

[…]

A June study by the Federal Reserve Bank of San Francisco found that only one worker out of seven is likely to turn down a job offer because of the current $300 per week federal benefit. That’s nearly the same portion as in the Morning Consult survey.

I don’t know quite how to interpret this. Maybe someone can elucidate it for me.

Does $300 a week just not mean that much to people? If that’s the case it calls the policy itself into question. Do people expect that something better will come along if they wait long enough? My offhand guess it that the results have multiple causes and vary from place to place in the country and from sector to sector. Thoughts?