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In states in the United States where governors prematurely terminated supplemental unemployment insurance programs, there is no evidence that cutting benefits has improved labor markets in those states.
That’s the conclusion of a JPMorgan research note released Friday that looked at Google searches for keywords like “unemployment” and “jobs” in states that have stopped the enhanced payments provided during the pandemic. Analysts have seen little evidence of an increase in the number of people seeking employment in these regions.
“We are seeing an increase in Google searches for ‘unemployment’ in states ending benefits in the days following the announcement, suggesting increased attention to the issue,” wrote Peter McCrory and Jesse Edgerton at JPMorgan Chase & Co. “But we find little evidence for an increase in ‘job’ searches that would indicate an increase in the number of people looking for work. “
The study also Noted little improvement in unemployment benefit filings, high frequency spending, or activity metrics like restaurant reservations and credit card spending.
More than half of U.S. states end enhanced federal unemployment benefit programs amid ongoing debate over whether they hinder recruitment efforts. With the reopening of the economy, consumer demand has far exceeded the ability of businesses to bring back workers. Job vacancies in the United States have reached a new record in May.
The debate surrounding the need to extend unemployment benefits is a controversial political topic of discussion, as nearly every state that has decided to end enhanced payments is headed by a Republican governor. Critics of pandemic-era federal programs – which have expanded eligibility to self-employed and contract workers and provided an additional $ 300 per week on top of existing state benefits – argue they are dissuading people from seeking work.
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