N.J. small businesses reject GOP claim that people won’t work if unemployment payments are extended

Posted Jul 29, 2020

A group of N.J. small business owners said they’d love to rehire the employees they were forced to furlough due to the coronavirus pandemic.

The problem is they have no work to offer them. And, they say, the extra federal unemployment insurance benefits scheduled to run out Friday are essential to keeping their workers above water until they can return to their jobs.

“Everybody who works for me has been anxious to come back to work and glad to come back to work,” said Kelly Conklin, co-founder of Kenilworth-based Foley Waite, a 14-person architectural woodworking firm. “People want to come back to work. This extended benefit is how they’re going to be able to come back to work.”

The picture painted by New Jersey business owners on a Zoom call held by the small-business group Main Street Alliance contrasts with the views of Senate Republicans, who want to slash the federal payments by two-thirds under the contention that the unemployment benefits now are so generous that they encouraging workers to stay home rather than return to their jobs.

“We’ve already heard from small-business owners who had troubling reopening because it would be financially irrational for their employees to come back,” said Senate Majority Leader Mitch McConnell, R-Ky., on the Senate floor Wednesday.

Under the $1 trillion Senate GOP stimulus package, the extra federal payments would be cut to $200 from $600 until state unemployment offices can rejigger their systems to pay out 70% of a recipient’s salary. The Senate proposal was released Monday, more than two months after House Democrats passed a $3 trillion measure.

One New Jersey small-business owner, Cliff Simms of Great Jones Books in South Pennington and Labyrinth Books in Princeton, said the extended unemployment benefits were a boon to his business, not a hindrance.

“These are very necessary to give employees security at a time when they desperately need it and to reduce all the social and economic hardships that come with this pandemic,” Simms said. “For small business owners, it’s a great thing because it gives us the flexibility to hire, rehire, labor based on the needs of the business as it comes back.”

Two independent studies, one by economist Ernie Tedeschi and one by Yale University, both found that the extra payments do not discourage workers from reclaiming their jobs.

“It’s a false notion,” Simms said. “That’s really all it is. It’s a talking point for an ideology but not a really the actuality of what workers face in America today.”

In addition to unemployment insurance, the differences between the Senate Republican and House Democratic bills are so vast that President Donald Trump and Treasury Secretary Steven Mnuchin on Wednesday raised the possibility of just passing a short-term extension of the unemployment benefits and a federal moratorium on evictions, and leave the rest to a later date.

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