The GOP said enhanced unemployment benefits were stopping folks from taking jobs. The US saw sharp payroll growth last month anyway.

• Republicans nationwide are ending unemployment benefits early under the argument they disincentivize returns to work.
• While the cuts haven’t yet gone into effect, payrolls still sharply increased in May, while the unemployment rate declined more than expected.
• A range in factors could be contributing to the labor shortage, including pandemic health concerns.
• See more stories on Insider’s business page.

Republicans in 25 states are cutting enhanced unemployment benefits early under the argument that the additional measures discourage people from re-entering the workforce.

But the May jobs report released on Friday, which saw 559,000 payrolls added – a sharp increase from April – and a bigger-than-expected drop in the unemployment rate, suggests the labor-market recovery is accelerating just fine on its own.

After all, none of the GOP-backed enhanced-UI cuts have even gone into effect yet.

Calls from the GOP to cut enhanced UI grew louder after April’s jobs report, which saw a shocking drop in new payroll additions that defied all economist forecasts. Upon seeing that, Republicans blamed the enhanced measures for disincentivizing work, which prompted a growing number of GOP-led states to end them.

On Friday, despite the acceleration of payroll additions from April’s numbers and lower-than-expected unemployment, some members of the GOP were still quick to brand the jobs report as a miss.

-Kevin McCarthy (@GOPLeader) June 4, 2021

Republicans and businesspeople have been critizing expanded UI – which was inserted into March 2020’s CARES Act by Democrats in the House – since the pandemic first hit in 2020. The US Chamber of Commerce quickly called for its cancellation in the wake of the April jobs numbers.

But Democrats have disagreed with that assessment. Sen. Bernie Sanders wrote on Twitter in April that we “don’t need to end $300 a week in emergency unemployment benefits that workers desperately need. We need to end starvation wages in America. If $300 a week is preventing employers from hiring low-wage workers there’s a simple solution: Raise your wages. Pay decent benefits.”

Some Democrats are even pushing for continued unemployment benefits tied to economic activity beyond the pandemic, but Biden said in a speech on Friday that while the benefits have been effective thus far, “it makes sense” for them to expire in September.

“A temporary boost in unemployment benefits that we enacted helped people who lost their jobs through no fault of their own, and who still may be in the process of getting vaccinated,” the president said in brief remarks following the May jobs report. “But it’s going to expire in 90 days – it makes sense it expires in 90 days.”

And while Republicans largely blame unemployment benefits for discouraging work, a JPMorgan note last week wrote that ending the benefits early is “tied to politics, not economics,” and Insider previously reported that there are a range of factors that could be preventing people from returning to work, like COVID-related concerns and lack of childcare.

So given that unemployment benefits haven’t ended yet, and payrolls were still added in May, the benefits might not be as big a disincentive as Republicans think, and experts are optimistic that the labor shortage should fade by the fall.

“The supply-demand mismatches in the labor market are likely to be temporary, and I expect to see further progress on employment in coming months,” the Federal Reserve governor Lael Brainard said in a Tuesday speech.