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Colorado keeping extra $300 unemployment benefits, hiring struggles persist

More than 20 state governors hope ending those extra federal benefits will incentivize people to work.

COLORADO, USA — More than 20 state governors are set to end federal unemployment benefits added under the CARES Act beginning this weekend in hopes of stimulating the economy and getting people back to work.

RELATED: No, the federal government isn’t dropping enhanced unemployment benefits, but some states are

Colorado will keep the extra $300 a week for people on unemployment insurance until it is set to expire in September, but businesses in the state face the same struggle to hire staff. 

“We’re still kind of social distancing and have limited capacity, not cause' of regulations but just because we need more man power to operate at full capacity," said Dylan Kaestner, the manager of Cherry Cricket in Cherry Creek.

The burger and beer spot has open positions they just can't fill. And they're not alone. 

More than 90% of restaurants across the state told the Colorado Restaurant Association (CRA) they are struggling to hire staff. 

In a recent survey, about 65% of operators told the CRA they believe the biggest obstacle to hiring is workers choosing to stay on unemployment benefits.

RELATED: The struggle to hire staff as bars and restaurants add hours and capacity at the same time

It's why governors, including Colorado's neighbors in Utah, Arizona, Nebraska, and Wyoming have decided to end the extra $300 a week for people on unemployment insurance beginning as early as this weekend.  

“I do not think economic decisions are made by just having or not having 300 dollars in your pocket," said Dr. Kishore Kulkarni, a Professor of Economics at MSU Denver

Kulkarni doesn't expect unemployment rates to go down in the states that end the extra benefits. He says wages need to go up. 

“As wages are pushed up, that is incentive enough for employees in restaurants, in the travel industry, in motels, to come back to work," he said. "And therefore increasing permanent wage is a better sign of coming back to work rather than just giving them $300 a month." 

Kaestner can't say for sure why they can't find employees, but he can speak for himself. 

“I've worked here for about 10 years and made a good living," he said. 

Colorado does have a program to incentivize to get people back to work.

RELATED: Colorado will pay people who are unemployed to get and keep a job

If people on unemployment benefits get a job before June 26, they can opt in to receive $1,600 or $1,200 if they keep that job for two months.

As of Monday, the Colorado Department of Labor and Employment (CDLE) said nearly 8,000 people have opted in. They estimate more than 100,000 people could qualify.

A spokesperson with Gov. Jared Polis' (D-Colorado) office sent the following statement on Wednesday evening:

“We know that just because more Coloradans are returning to full-time work after this global pandemic, it doesn’t mean their financial challenges are going to simply disappear. Coloradans who are out of work are looking for jobs across Colorado. Colorado was one of the earlier states to put the requirement back in place that all unemployment beneficiaries are actively searching for a job to qualify for benefits.

We want to make sure that Coloradans are set up for success as they transition back into the workforce. We’re thrilled that 7,953 claimants have already opted into the Jumpstart program as of June 7, 2021, and we fully expect more workers take advantage of the $1200 incentive during June. The Governor was in Glenwood Springs and Grand Junction this week and heard very positive things about how the bonuses have increased applications. CDLE will be updating this number every Monday and publishing on its UI Daily Dashboard.

Jumpstart payments will be paid in two installments: the first half approximately 4 weeks after a claimant opts in, the second half approximately 8 weeks after a claimant opts in. The first set of eligible payments will be made before the end of June. We are proud to see nearly 8,000 Coloradans reporting that they have returned to work in this three-week period.”

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