NASHVILLE, Tenn. (WKRN) – Tennessee stands to lose out on nearly half a billion dollars for local economies according to the U.S. Joint Economic Committee.
This comes after Governor Bill Lee announced the state will opt out of the federal unemployment pandemic assistance on July 3.
Tennessee is among 24 states to cancel the federal benefits.
“When we have 250,000 job openings in the state and we are paying people to stay home that needs to change,” Lee said.
The governor is sticking by his decision to end benefits early losing out on $485 million in benefits to local economies in the state.
“We believe that this decision will actually enhance our economic recovery and create revenue stream for the state,” Lee said.
Davidson County Democratic Senator Heidi Campbell said the governor’s decision is simply bad economic policy.
“We’re going to lose $486 million dollars of economic fuel because of this decision and of course I completely support giving aid to our businesses, but businesses need customers,” Campbell said.
The nation’s unemployment rate stands at 5.8%, while Tennessee’s unemployment rate is around 5%.
The same report states the early cancellation will result in a loss of $300 million dollars to individual Tennesseans.
“If the goal is to stimulate growth in an economy that’s badly shaken by the pandemic then government spending is more efficient when it’s invested in citizens,” Campbell said.
Lee pointed to a business in Memphis that’s only open three days a week due to trouble finding workers, adding the business said would-be workers are sitting at home collecting a check.
When asked if he agreed with the statement by the business owner that people are sitting at home collecting checks, Lee seemed to contradict himself.
“The business owner said that people are sitting at home collecting checks and I’ve said that we should not pay people [sitting] at home,” Lee said.
Campbell said while there are some bad actors, she said most Tennesseans need the help.
“One thing we need to really think about is whether or not we are offering jobs to people or providing jobs to people that are sustainable a lot of people are not doing their second job in this incredibly regressive economy that we have — we have people who really struggle just to survive now,” Campbell said.
Additionally, the Joint Economic Committee report found that for every $1 in unemployment, $1.60 is generated in local spending.