Dems Warn GOP Unemployment Changes Will Drive Away Workers From Iowa

Wednesday afternoon, Republicans in both chambers of the Iowa Legislature supported an amendment to reduce unemployment benefits from 26 to 16 weeks. GOP senators added a one-week waiting period before those benefits are delivered in their version.

The amended bill, House File 2355, passed the Iowa House 58-37. The Senate passed a bill with a similar amendment this evening, 30-20. Two Republicans each in both chambers joined Democrats in voting against the measure.

Democrats stood up to protest the move in both chambers, emphasizing how necessary these benefits are and how cutting it wouldn’t help the workforce crisis or support Iowans who lost their jobs through no fault of their own.

“When you lose your job, you’re panicked, you’re scared. You don’t know what’s coming next…,” said Rep. Jennifer Konfrst (D-Windsor Heights). “People who lose their jobs through no fault of their own are not sitting at home collecting checks because they don’t want to work. And if they are, let’s punish them? Why are we punishing everyone because a few people are working the system?”

Iowa’s labor unions are firmly against the bill. Many have pointed out that it will unfairly burden workers whose jobs are naturally seasonal.

Only nine states in the country offer fewer than 26 weeks of unemployment benefits, though Missouri, Idaho, Michigan, South Carolina still offer 20 or 21. All of Iowa’s neighboring states, except Missouri, offer 26 weeks.

Rep. Mike Bousselot (R-Ankeny), who introduced the amendment, asserted it was needed to update the unemployment system and create “a re-employment system, not an unemployment system.”

The other rationale was to fill the multiple job openings in the state.

“We have hard-working Iowans who are working extra because employers can’t find folks to fill those extra jobs,” Bousselot said. “This is to help create that incentive and the training programs and the reemployment programs necessary to get folks back to work.”

“I see this legislation and the focus in modernization of unemployment to an active program that is about reemployment and upscaling as something that will get Iowans back to work,” he continued.

Iowa’s current unemployment rate is 3.7%, according to the Bureau of Labor Statistics. According to the Iowa Workforce Development, as of March 12, 1,376 claims had been filed.

Another aspect of the bill changes the definition of “suitable work.” Under the new rule, Iowans would be required to accept lower wages sooner. For example, Iowans would have to accept jobs that paid 80% of their original wage if the work was offered in the fourth and fifth week of the person being on unemployment.

If eight weeks go by, a person must accept a job even if it only pays 60% of what they were making before.

This would lead, many pointed out, to a lot of people struggling.

“Does her rent go down by 60%? Does her car payment go down by 60%? Do her childcare costs go down by 60%? No,” said Rep. Sue Cahill (D-Marshalltown). “But now she needs to apply for other public programs, such as the Nutritional SNAP program, the Insurance Hawki program, to meet her children’s needs, and child care assistance and other programs, even though our wage worker is working full time, but at 60% of her previous wage.”

Eventually, workers could leave the workforce—in order to cut down on costs for childcare or transportation—or leave the state.

This is especially true for seasonal workers such as those who do construction, and rely on unemployment benefits to see them through the off-times.

“I’m unhappy about the fact that House File 2355 will do nothing to address the workforce shortage in Iowa. In fact, I will argue that this bill could actually create an even greater shortfall of workers,” Rep. Mary Mascher (D-Iowa City) said. “Because if I live in Davenport and I can go to Illinois, where I know they have worker protections and they pay a much higher minimum wage with benefits, I can tell you where I’m going to work.”

Rep. Chris Hall (D-Sioux City) cited a Wall Street Journal study which showed slower job growth in states that cut federal unemployment benefits early. Iowa was one of those. On the other hand, states which kept those benefits continued to grow.

“The economist who performed the study for The Wall Street Journal was quoted and said, ‘If the question is, is unemployment the key thing that’s holding back the labor market recovery? The answer is no, definitely not based on the data,’” Hall said.

 

by Nikoel Hytrek
02/23/22

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