How Mississippi flipped the script on COVID unemployment

By Around the Web


[Editor’s note: This story originally was published by Real Clear Policy.]

By Jonathan Bain
Real Clear Policy

Kevin Fish, owner of Half Shell Oyster House on the Mississippi coast, said it best: “Getting customers is no longer the issue. Now the problem is finding people that want to work.”

This was a problem permeating throughout Mississippi for months while struggling to keep our economy afloat and leave the pandemic behind us.

In early 2021, Mississippi faced the worst labor shortage in state history. By late spring, the situation had only worsened.

There were a record-high 84,000 jobs open throughout the state — more open jobs than people actually looking for work. There were still nearly 80,000 Mississippians collecting unemployment benefits — more than 10 times as many than before the pandemic struck. And Mississippi businesses desperately needed workers.

The cause of this was simple: Federal unemployment expansions and bonuses were paying people more money to stay at home than they could make working. The solution to these woes plaguing our state was also simple. Governor Tate Reeves saw the need for swift action and, in June, Mississippi became one of the first states nationwide to opt out of these expansions and bonuses months before they were set to expire.

The results have been tremendous.

Immediately following Gov. Reeves announcement, work search activities spiked throughout the state. When people began actively looking for work again, Mississippi businesses were finally able to start filling open positions.

In fact, businesses across the state hired more than 72,000 workers in the month of June alone — the largest hiring spree in state history. But it gets better. The hiring spree continued throughout the summer and fall, with more Mississippians being hired between June and September than any other four-month period on record.

Overall, the largest hiring spree ever recorded in state history resulted in more than 300,000 open jobs being filled, with nearly 11,500 jobs being filled each week.

Mississippi employers aren’t the only beneficiaries of Gov. Reeves’s leadership, though. Taxpayers also found great relief as hundreds of thousands of Mississippians moved from welfare to work.

Before Gov. Reeves’s decision to opt out of federal unemployment expansions and bonuses, taxpayers were paying roughly $38 million for unemployment benefits every week. But one week after these benefits expired, that number plummeted to under $3 million per week. Fast forward to December of 2021 and taxpayers were paying less than $600,000 per week for unemployment benefits — an overall drop of 97 percent.

Our state owes a great deal of gratitude to Gov. Reeves. Our economy was teetering, employers were struggling, and more Mississippians were trapped in unemployment than ever before.

As Jesse Bandre, owner of Pizza Doctor in Tupelo, MS, said in March 2021: “I think there’s a lot of businesses in need of employees right now. Honestly, now we just need people to work and that want to work. If they’re coming in to work, we want them.”

But with one decision, our state managed to flip that script.

Instead of facing a record-high number of open jobs, Mississippi has filled a record-high number of open jobs. And we enjoyed the largest hiring spree in recorded state history. Unemployment costs plummeted by 97 percent, and taxpayers haven’t been left holding the bag for folks who were making more money to stay home than work.

Mississippi became a nationwide leader with more workers, lower unemployment costs, and booming businesses. Thank you, Gov. Reeves.

Jonathan Bain is a senior research fellow at the Foundation for Government Accountability.

For more on how states are providing practical answers to today’s policy challenges, visit the RealClearPublic Affairs State Solutions page.

[Editor’s note: This story originally was published by Real Clear Policy.]

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