Government benefits competing for workers

A recently study by the Ohio Chamber of Commerce Research Foundation shows that 20% of Buckeye State businesses have had problems with hiring, promoting or increasing wages for workers because they are worried that doing so would mean those folks lose some form of public assistance, according to The Columbus Dispatch.

Advocates are asking lawmakers to pay attention to the problems associated with “the benefits cliff.”

A Policy Matters report last year showed that 60% of Ohio’s 10 most common jobs paid an average full-time worker less than $26,000 per year.

Policy Matters is a liberal research group, which means its suggested solution is for employers to raise all wages high enough to avoid worries about the benefits cliff. Most Ohio employers are not in a position to do such a thing. Some are closer to their own financial cliffs than they would like to think about.

According to Justin Barnes, executive director of the Chamber’s Research Foundation, there are workers in Ohio turning down pay raises, quitting jobs or declining job offers altogether because they do not want to lose taxpayer-funded benefits.

“That leaves workers frustrated because they feel trapped by the system,” Barnes told The Dispatch. “It also frustrates employers.”

The bottom line is that many in the private sector are facing competition for workers from taxpayer-funded government programs. And not just in Ohio. When state benefits are more lucrative than a pay raise, something isn’t right. Now, the question is: What can be done about it? Anything?