Believing that they are responsible for sluggish job growth, the U.S. Chamber of Commerce said it plans to fight to repeal the $300 supplemental unemployment payments that have kept millions afloat in the pandemic, according to CNBC. The Chamber claims that, due to these supplemental payments, one in four Americans make more money on unemployment than they would have working. Having far too much economic security, these people are much less likely to take on the jobs, largely low-paying menial work, they did before the pandemic. The Chamber says this is a bad thing and so should end.

While unemployment payments are probably playing a role, the reason for labor shortages is likely a constellation of different factors playing in the global economy right now. For one, the pandemic itself is still raging, and many simply do not trust their employers to take their health and safety into account, which has kept them away from jobs, like restaurant work, that puts them in contact with a lot of people. While a poll conducted by PricewaterhouseCoopers, found that 64 percent of CFOs are "very confident" that their firms can provide a safe working environment for employees, another PwC survey found workers to be a little less confident, as 51 percent said they're afraid they'll get sick if they go into work.

Another factor is that remote work has boomed in the pandemic: as of April, postings for telecommuting jobs are up 45 percent versus what they were pre-pandemic, and so it is likely many of these people who had been doing service jobs before have now migrated online, which are much safer from a pandemic perspective. Many others have also opted to use the time they had to change careers entirely.

Then there's the fact that, with the disruption to school schedules, many parents saw their domestic duties surge during the pandemic, to the point where parents (mostly mothers) were scaling back hours or leaving their jobs entirely, which has led some to put off finding work because they're needed at home. A recent report authored by Lean In and McKinsey found that one in four women are considering downshifting their careers or leaving the workforce due to COVID-19. Focusing on mothers specifically, this proportion grows to one in three. Even elite women are affected: among those in senior positions, 36 percent said they are feeling pressure to work more, 54 percent said they feel exhausted, and 39 percent they feel burnt out. The aforementioned PwC survey said that 15 percent would not return to work due to family responsibilities. One Nobel Prize-winning economist suggested that subsidized childcare could help in this respect.

Past all this, though, there are also questions about the degree to which unemployment payments are having a role at all: one economist noted that labor shortages are pretty evenly distributed across the U.S. despite certain states being more generous than others when it comes to benefits; if benefits were the biggest culprit, according to this economist, then we would see more state-to-state variation, with shortages scaling with payments.

Further, it is unknown whether those on unemployment are necessarily living the high life while restaurants and bars languish without staff. A survey from March found that 1 in 3 unemployment beneficiaries still struggle to pay for food and housing despite the enhanced payments. An analysis from Aug. 2020, meanwhile, noted that 68 percent of people who had been on jobless benefits but then either returned to their old job or staretd a new one were making more money on unemployment but chose to go to work anyway. The analysis concluded that the fact they'd be making less money was not a disincentive to find a new job. A report from the Chicago Fed came to similar conclusions after finding that those on unemployment insurance are actually more likely to be looking for a new job, and that rather than accelerate things, running out of benefits seems to actually depress job searching.

Finally, it might be debatable that, even if the premise was right on the money, this would be a bad thing necessarily. A study from the National Bureau of Economic Research concluded that more generous unemployment benefits ultimately lead to people finding better jobs–ones more suited to their skills. The paper concluded that more generous unemployment benefits ultimately lead to people finding better jobs–ones more suited to their skills. This effect, however, does not mean that every worker winds up making more money or working at a better firm. It noted that the improved sorting effect not only means that good workers are more likely to wind up at good firms, but that bad workers are also more likely to end up at bad firms. On the other hand, the paper found that "UI can improve the likelihood that lower performing workers are now able to get a job rather than remain unemployed because other jobs are now freed up by UI recipients moving to better jobs."