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Workforce Shortage Leads State Leaders To Cancel Federal Unemployment Benefits

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South Dakota is one of a number of states that plan to eliminate federal unemployment benefits by the end of June. Some state leaders say the enhanced benefits keep people from taking jobs.  

That’s even led one state lawmaker to propose cutting the state’s unemployment office. 

At the beginning of the pandemic Monument Health stopped all elective surgeries. That led to furloughs across the health system. 

Trina Allen is the vice president of human resources at Monument Health. 

“I quite honestly am thankful for the federal funds so that our caregivers could remain whole while they were off work,” Allen says. “The good news is almost all of them were able to return to work after we resumed elective surgeries.” 

But now, Allen says Monument is having trouble filling its open positions. 

“There’s just not a lot of workforce for all of our jobs,” Allen says. “I have lots of thoughts as to why that might happen. The fact is it is hard to find enough workers.” 

The Black Hills health system is headquartered in Rapid City. It employs over 5,000 people. 

The South Dakota Works website shows Monument Health has about 324 open jobs, from Custer to Spearfish. Allen says that’s typical for an organization its size. 

The state website seeks to pair those looking for work with jobs across a range of positions and industries.  

At a recent event at Mt. Rushmore National Memorial, Governor Kristi Noem announced a new initiative that seeks to pair those looking to work in the tourism industry with jobs in South Dakota. 

Governor Noem announces an initiative to pair those looking to work in the tourism industry with jobs in South Dakota.

“That’s really what we’re doing differently this year. Not just working on recruiting visitors but recruiting those people who want to work in the tourism industry and facilitate apprenticeships, training programs,” Noem says. “So we can fill those open positions that we have.” 

However, help wanted signs persist across the Black Hills and the entire state. As a result, Governor Noem says the state will stop offering expanded federal unemployment benefits. Eighteen other Republican controlled states are taking the same approach. 

However, some say the state should go even further. 

“We’re paying these unemployment benefits out to people and it’s encouraging them not to work,” Goodwin says. “We shouldn’t be doing that. We got to quit paying people not to work.” 

That’s state Representative Tim Goodwin. He’ll offer a measure to close the state’s unemployment office next session. It’s a proposal with varying levels of support. Goodwin calls unemployment a relic of the past. 

“We can look back and say there was a time and place for it,” Goodwin says. “But, like I said, the times have change. Now, everybody desperately needs workers.” 

Goodwin, a Republican, says the private sector can figure out the unemployment issue better than the government. 

Last April, when the pandemic began, there were 8,000 new unemployment claims in one week. There were five consecutive weeks with 5,000 or more unemployment claims. One year ago, there were more than 25 thousand people on unemployment in South Dakota. 

The federal government stepped in, offering enhanced unemployment compensation beyond the traditional 26 weeks given by the state. It also issues additional $300 weekly payments to those on unemployment. 

Marcia Hultman is the secretary of the South Dakota Department of Labor and Regulation. 

From Left: Trina Allen, Tim Goodwin, and Marcia Hultman

She says the state has a workforce issue. Even if everyone currently on unemployment got a job, there would still be more jobs than there are people to fill them.  

“We have about 23,000 open jobs, which is a record high,” Hultman says. “A huge number of job openings.” 

There are currently about 2,500 South Dakotans receiving unemployment benefits. Hultman says there are about 10,000 people in the state who are not looking for work right now. Even if all those people - 12, 500 of them - got a job tomorrow, the state would still have more than 10,000 jobs to fill.  

Which means employers have to compete for those interested in working. 

“We train people to do all sorts of work,” says Trina Allen, with Monument Health. She says they have openings in a number of departments. 

“For us, specifically, if people think ‘Well gosh, I can’t work at the hospital because I’m not a doctor or a nurse.’ I want them to know we have lots of jobs available,” Allen adds. 

Some of those jobs include sign on bonuses, especially for nurses. Some say the hospitality industry is also starting to advertise higher wages as businesses compete in a tight labor market.