Gov. Phil Murphy declined to say whether the state will continue a litany of federal jobless benefits, such as the weekly $300 bonus, past its Sept. 6 expiration date–and whether the state would use COVID-relief funds to push off a looming unemployment tax hike.
“No news on the unemployment extension,” he said when asked during a regular COVID-19 press briefing on Aug. 23.
The state has paid out a combined $33 billion in both federal and state unemployment benefits, and currently half a million New Jerseyans depend on the aid.
As for using federal funds from the American Rescue Plan to offset a $250 million tax increase, Murphy pointed to a law he signed earlier this year that spaces out the tax increase so that it’s roughly $250 million per year for three years, rather than a $1 billion tax bill needed to replenish the state unemployment trust fund.
Businesses say they’ve been hounded on multiple fronts coming out of the pandemic.
First, many employers – especially those in the restaurant, hotel, retail and entertainment industries – typically booming during the summer have struggled to bring back workers. Many owners claim the added $300 in federal unemployment weekly benefits has, in turn, disincentivized people to return to work and fueled a disappointing nationwide April jobs report, which saw 266,000 jobs added rather than the projected 1 million. Labor rights organizations contend that a combination of low pay, poor working conditions and lack of health and safety precautions – especially in light of the pandemic – are driving a shortage of applicants.
Data from the federal Bureau of Labor Statistics show that the state’s economy has recovered 62% of the jobs lost during the pandemic.
Second, businesses are being hit with the $250 million in tax increases starting Oct. 1, after pandemic closures triggered record-high unemployment and jobless claims last year. Republican lawmakers and business groups have suggested since the spring that the state should use ARP funds to offset the tax increases.
Gov. Phil Murphy announces indoor mask requirement for the beginning of the 2021-2022 school year in East Brunswick on Aug. 6, 2021 – EDWIN J. TORRES/GOVERNOR’S OFFICE
But the administration said that because of how late the funds were deposited into the state’s coffers, that was not possible. New Jersey Republicans have heavily disputed that notion.
“I signed a law several months ago that would smooth this increase out,” Murphy said. “No state in America per capita has put more money into small businesses than New Jersey.”
“[F]olks should expect we will be doing more,” he continued. “So, whether it’s specific or not to the unemployment insurance question, you should know that we are constantly thinking through how we can continue to plus up help and aid to small businesses and we will do that.”
Amid closures last year, the federal government approved a litany of unemployment and business relief programs meant to prevent a total economic collapse and to keep many workers out of poverty.
The initial round of benefits passed under former President Donald Trump came out to $600 a week. On top of that, there’s the Pandemic Unemployment Assistance which offers jobless benefits to freelance workers, and Pandemic Unemployment Emergency Compensation, which provides an added 13 weeks of benefits. They expire on Sept. 4 and Sept. 5 respectively.
Federal guidance allows states to use their ARP funds towards continuing any of those three programs.
