Over the last 18 months, there’s been a ton of discussion surrounding unemployment. This discussion has come from all sides, from the benefits provided to those out of work, the resulting New Jersey labor shortage, and the eventual end to extra UI benefits that occurred in August.
For the most part, business owners have been happy that the extra benefits have come to an end, but it hasn’t exactly translated to the hiring boom many had hoped for. Just as extra benefits have expired, many seasonal workers are heading back to school, somewhat balancing out the labor benefits business would have experienced during a different time of the year.
In response, Governor Murphy has unveiled Return and Earn, a program designed to incentivize unemployed workers heading back into the workforce. At the same time, it’s designed to encourage employers to hire these specific people.
In this article I’ll discuss what the Return and Earn program does, and how it’s possible for business owners to benefit financially while solving their staffing issues at the same time.
What is the Return and Earn Program for NJ?
Return and Earn is a program that pays workers $500 for returning to work and being trained by businesses with fewer than 100 employees. For employers, there is an opportunity to have 50% of the employee’s wages subsidized for up to six months.
This is a state program that will be funded with federal money. Governor Murphy has stated that the program will have a cap of $10 million dollars and will be funded with federal money received via the American Rescue Plan.
There are some caveats though, so let’s look into the specifics we know of so far.
What are the Requirements for Employers to Participate in the Return and Earn Program?
Employers must pay at least $15/hour and hire applicants that have been deemed to have “identifiable skill gaps” by the existing NJ On-The-Job training programs. Additionally, because an individual is employed by you, they must be obtaining some sort of skill, certification, or credential that is recognized within your industry.
What exactly that means is not clear currently. Does an employer have to guarantee a credential, or just the opportunity to obtain one? For example, if a restaurant owner offers their new employees the opportunity to get a ServSafe certification, does that count? If that’s the case, do employers then need to offer that opportunity for free? If they do, do they then have to offer that to all their employees for free?
Even on the state DOLWD website, they acknowledge that they’re currently working out how to get this new program in working order, so the answer to “what does that mean” is currently unanswered.
That said, if you’re interested in being involved in the program, or at least getting detailed information about it as soon as possible, get ahead of the crowd and fill out the preliminary application now.
What are the Benefits of the Return and Earn Program for Employers
Employers can have 50% of the wages of qualified employees subsidized during the contracted training period. This amount is capped at $10,000 per individual hire and at $40,000 for all hires.
Meaning, if you were to hire two employees through Return and Earn, the maximum amount of wages paid would cap out at $20,000, while four employees or greater would cap at $40,000.
Will the Return and Earn Program Make a Difference for Anyone?
Sadly, it appears this program is just too narrow in scope and too underfunded to make a real difference for the business community, the unemployed, or the overall economy. When I saw the headline of this program being released, I got excited because it seemed like a good opportunity for everyone, but was more than a little disappointed when I looked at the mixture of variables that define it currently.
It’s so specific in its requirements of who can be hired, and what employers must provide in return. For many, they won’t meet the requirements, and probably don’t have the time to figure out ways that they could meet the requirements. It’s a very disconnected perspective to hear from the state that you need to provide an employee with an industry-specific and industry-accepted qualification, many jobs simply don’t have the means to do that.
Talk to a roofer, a restaurant owner, or an office manager, and ask what kind of professional certifications they plan to provide an unemployed person, and they’re likely to look at you a little funny and say “uh…a job.” It’s a little strange to put further responsibility on employers who are already hiring an under- or unqualified worker, usually they’re helping the person by giving them an opportunity to learn through working
When you do the math, it’s less than 1,000 people that will actually be hired through this program. $10 million dollars sounds like a lot, but when we’re talking about statewide programs it’s almost nothing. More money has likely been spent on fixing Main Street in Asbury Park.
Governor Murphy left the door open to possible further funding, but this feels very much like a political move during an election year, as opposed to any real solution to a very real problem.
Sorry for my skepticism, but I’m not seeing great value in this program as it stands currently.