Baker’s $4,000 employer hiring bonus called ‘deeply misguided’
Rewards employers for doing what they are already doing, Horowitz says
ONE OF THE STATE’S leading policy analysts is raising alarms about a proposal put forward by Gov. Charlie Baker to give nonprofit and for-profit businesses a $4,000 stipend for each new employee they hire through the end of the year.
The $50 million program, funded using federal American Rescue Plan Act funds, is designed to incentivize businesses to cast their net wider for employees and use the $4,000 for training, education, or other initiatives to give the new employees a chance to succeed.
But Evan Horowitz, executive director of the Center for State Policy Analysis at Tufts University, said the proposal is “deeply misguided” and “designed the wrong way.”
“It’s both the wrong goal and the wrong way to achieve that goal,” he said.
The Baker proposal, he said, rewards employers for doing what they are already doing. He worries that the $4,000 stipends will quickly be gobbled up by employers hiring workers in the natural course of business.
In other states, Horowitz said, employers receive incentives for hiring hard-to-place workers, like people recently released from prison. But the Baker administration proposal places no restriction on employers and who they hire.According to the program’s website, grant recipients must have a physical business location in Massachusetts and the employees they hire must work at least two months and get paid the annual equivalent of $21,375 to $85,000 a year, or $14.25 to $42.50 an hour.
Employers are free to use the $4,000 stipend however they see fit. They are not required to document their training methods or specific expenses. They can collect up to $400,000, for 100 employees, and the money will be dispensed on a first-come, first-served basis through the end of the year or whenever the $50 million in federal American Rescue Plan Act funds run out.