As unemployment claims surge, businesses could find it hard to encourage staff back to work

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FRESNO, California (KSEE) – As businesses start to reopen, employers are finding it hard to lure their employees back. Many seem to be making more by on unemployment than if they were working.

Current federal benefits paid to those on unemployment are set to end in July. What is unclear is if employers offer employees their jobs back and the employee declines, whether or not their benefits will continue to be paid.

Meanwhile, the Employment Development Department is seeing a historic demand for unemployment benefits in California.

“I’m making a little more,  but uhh, probably just a little more than what I was making,” said Tamara Mejia who is receiving unemployment because of the pandemic.

Since the week ending of Mar. 14, the EDD says they have processed a total of 4.1 million claims for benefits and paid a total of $8.9 billion in benefit payments.

The claims consist of both Unemployment Insurance and the new Pandemic Unemployment Assistance program, according to the Employment Development Department. 

“We went from processing two to 5,000 claims to hundreds of thousands of claims overnight,” said EDD Director Sharon Hilliard.

The CARES Act means those on unemployment are able to receive an extra $600 every two weeks. 

However, if employees are making more money not working, many might choose to keep it that way. That could create a problem for small businesses as they have to hire staff back within the next two months if they want the loans they received from the Federal Paycheck Protection Program to be forgiven.

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