CONCORD — With New Hampshire’s economy recovering more quickly from the pandemic than many had expected, Gov. Chris Sununu says he plans to end extra unemployment benefits fairly soon.
“We’re definitely thinking about it sometime in the next few weeks,” Sununu said during an online presentation hosted by the Business and Industry Association on Wednesday. “The federal government wants to do it all the way to September. We’re not doing that.”
His statement is good news to the BIA, a business trade group that feels generous unemployment benefits are contributing to many businesses’ hiring difficulties.
“I think that’s music to a lot of the folks on this webinar,” said Jim Roche, president of the BIA.
A cautionary note came up later in the three-hour Economic Summit during a presentation by Jeffrey Thompson, an economist with the Federal Reserve Bank of Boston. He presented data showing that the pandemic recovery has been weakest for those who are most dependent on government payments such as unemployment.
“The sectors that were hit the least hard and have recovered the most are also the highest paying,” Thompson said.
The business sector in New Hampshire hardest hit by the pandemic has been leisure and hospitality, including restaurants and hotels. Not only has it seen the most job losses, the employees in those industries make less than any other major job industry in the state: an average of $477 a week, or less than $25,000 a year.
“Those households are subsisting largely on unemployment insurance right now,” Thompson said.
As of Thursday morning, governors in 11 states, none of them in the Northeast, had said they will opt out of the federal unemployment programs early. President Joe Biden has said the federal program, which includes an extra $300 weekly payment, will end in September.
In his presentation, Thompson agreed with Sununu that New Hampshire’s economy “has performed better than most states” during the pandemic, with a variety of business metrics falling sharply at the beginning, but recovering more quickly. The state’s gross domestic product is already almost back to pre-pandemic levels, he said.
“There was an unheard-of, short-term cratering of employment, also with a very sharp rebound. … New Hampshire is rising sharply above the pack, the highest grower. … It’s only 5% below pre-pandemic levels of total employment,” he said.
In his comments, Sununu also emphasized plans to phase out the business profits and business enterprise taxes over the next few years, both of which are popular with most BIA members.
“We can make big investments … without raising more taxes. In fact, we do it by cutting taxes, encouraging more businesses to come in,” he said.
The webinar began with a semi-joking comment about procedure from BIA President Roche that wouldn’t have made much sense before the pandemic taught everybody about “Zoom bombing” and other online disruptions: “If the Russian Mafia or the Chinese military takes over this webinar, we’ll shut it down.”