The return-to-work incentive program put forth by Montana Gov. Greg Gianforte in May will likely have delivered $1,200 bonuses to around 3,000 people by the end of its lifespan come January, officials with the Department of Labor and Industry said this week, only a quarter of the 12,000 individuals the state once anticipated paying.
The program, which Gianforte launched in the same breath as he ended Montana’s participation in federally-funded enhanced pandemic unemployment benefits, was intended to get workers with active unemployment claims into the workforce with bonus payments issued upon the fourth week of employment at a new job.
The eligibility period ended in October, with officials acknowledging the slow pace and chunking out much of the funding to other programs, but the state still had the rest of the year to pay out claims and address questions with applications.
Now, as the year ends, DLI reports that it’s likely to spend around $3.6 million on the incentive payments out of the $15 million that state officials first set aside.
“We absolutely served less people than we expected,” said Scott Eychner, DLI’s Workforce Services Division Administrator in a meeting of a legislative budget interim subcommittee this week. “I wouldn’t categorize this as a failure, that is very much just a reality check of the situation.”
DLI received around 6,300 applications over the life of the program, with the majority either denied (around 1,600 as of Dec. 17) or outstanding (around 1,800). And of the outstanding applications, Eychner said, around 1,500 are from those who filed an application but never followed up with the department. DLI is doing a final round of engagement to get in touch with those individuals, Eychner said, but if they’re unsuccessful, those too will go down as denials. Only around 300 outstanding applications are under active consideration.
For the most part, according to DLI, recipients of the bonus took jobs paying $20 an hour or less.
The number of unemployed Montanans is around 15,400, Gianforte announced this week, touting a 2.8 percent unemployment rate.
Montana was the first state to back out of the federally funded enhanced unemployment insurance program, which added $30o a week to base unemployment benefits for those on UI. Gianforte argued that the benefits were contributing to a labor shortage, though critics attacked the decision as leaving federal dollars on the table.
In the same swoop, Gianforte restored a requirement that UI claimants actively seek work and introduced the return-to-work program. The decision also had the effect of ending Montana’s participation in a variety of other federal pandemic unemployment programs, such as Pandemic Emergency Unemployment Compensation.
To be eligible for the one-time $1,200 bonus, an individual had to be on unemployment beginning May 4 and then take a job in any industry for at least four weeks. Many of the 1,600 denials were for applications that didn’t meet the basic criteria, Eychner said — they weren’t on unemployment within the time horizon of the program, for example, or they found a job out-of-state.
Additionally, he said, the department learned some were unable to work because of difficulties finding housing or childcare, for example.
The department will be issuing a full report on the program in January.