What does end of federal unemployment mean?
James Kennedy, a Mount Vernon musician, said the end of Iowa’s federal unemployment benefits feels almost like “blackmail.”
“This decision … to withdraw literally forces people to go back to work in a very unsafe environment,” Kennedy said. “I find that very life-threatening.”
Kennedy and his wife, Catherine Lawson-Kennedy, lead the Heart Consort Music group. Before the pandemic, they taught music lessons to nearly 30 students, performed concerts several times a month and rented out a recording studio to local artists. That all came to a sudden halt in March 2020. Aside from a few sporadic Zoom lessons, the Kennedys put their business on hold and filed for unemployment. They received state unemployment insurance and additional funds through federal programs.
“There was enough to keep us stable,” Kennedy said. “Pay the mortgage, put food on the table, take care of the majority of the bills. We still had to use some of our own savings to balance all of that out, but it did help.”
As of Saturday, the Kennedys and other Iowans receiving unemployment are no longer receiving additional federal benefits. Gov. Kim Reynolds announced in May she would discontinue Iowa’s participation in the federal program in an effort to bring unemployed Iowans back to work. Reynolds defended the decision at a conference for the Iowa Association of Business and Industry.
“Almost every business owner I talk to, small, medium, large, in every sector, without fail, tells me they’ve had trouble getting people to show up,” Reynolds said. “And that’s why I made the decision to end Iowa’s participation in federal $300 weekly supplemental unemployment benefits.”
The ABI conference-goers applauded.
“Today, we have more job openings than we have people on unemployment,” she said. “So why would we allow the federal government to hamper our economic recovery by paying potential workers to stay home?”
According to the Department of Labor, more than 30,000 Iowans filed for federal unemployment benefits in the week ending in May 22. Business leaders have lauded the change.
“Imagine the frustration of operators ready to welcome patrons back, only to find that the people we need by our sides to serve, prepare food and beverage, and help in our establishments are opting to sit the summer out because they are being paid to do so,” said Iowa Restaurant Association President Jessica Dunker.
Iowa is one of 25 states to end the federal benefits before September, when they were scheduled to expire. President Joe Biden in early June defended his Sept. 6 deadline for the program, but his press secretary acknowledged that states have the power to withdraw from the program whenever governors decide to do so.
Iowa Democrats have opposed the change, arguing it burdens Iowans who might be unable to return to work. Sen. Zach Wahls, D-Coralville, has called for more support for unemployed Iowans, rather than less. Rep. Todd Prichard, D-Charles City, predicted in May the removal of additional benefits would slow the economic recovery.
“It has real consequences for Iowa families who are behind on rent, trying to put food on the table, pay for child care, and get their lives back to normal,” Prichard said.
Even before the benefits deadline, Iowa was recovering more quickly than other states.
“The emergency is over, and Iowa is coming back strong,” Reynolds told the ABI conference.
The Kennedys disagree. Though both James and Catherine have been fully vaccinated, they’re not comfortable doing indoor, private lessons.
Lawson-Kennedy said she had been virtually teaching a student who wanted to begin in-person lessons — but he refused to get the vaccine. The Kennedys had anticipated a return to business in September.
With the benefits ending, Lawson-Kennedy is considering offering string classes outside.
“I think there’s a lot of people besides us who are sitting around, looking at the ceilings of their houses and wondering, ‘What the hell are we going to do?’,” Kennedy said. “A lot of people are in a real bind.”