Effective June 26, unemployed Texans will no longer be eligible to receive the $300 weekly unemployment supplement from the Federal Pandemic Unemployment Compensation program, as Gov. Greg Abbott informed the U.S. Department of Labor on May 17 that Texas would be opting out of further federal unemployment compensation related to the COVID-19 pandemic.

According to a May 17 news release, Abbott decided to opt out of the program due to the the vast number of well-paying jobs that are available statewide. According to the Texas Workforce Commission, nearly 45% of posted jobs offer wages that are greater than $15.50 per hour and approximately 76% pay more than $11.50 per hour; only 2% of posted jobs pay around the minimum wage of $7.25 per hour.

"The Texas economy is booming and employers are hiring in communities throughout the state," Abbott said in a statement. "According to the Texas Workforce Commission, the number of job openings in Texas is almost identical to the number of Texans who are receiving unemployment benefits. That assessment does not include the voluminous jobs that typically are not listed, like construction and restaurant jobs. In fact, there are nearly 60% more jobs open—and listed—in Texas today than there was in February 2020, the month before the pandemic hit Texas."

Additionally, the news release stated that Abbott's decision was also necessary due to the high number of fraudulent unemployment claims that are being filed. According to the TWC, nearly 18% of all claims for unemployment benefits during the pandemic are confirmed or suspected to be fraudulent, which totals more than 800,000 claims worth as much as $10.4 billion, if all claims had been paid.

"Fraudulent unemployment claims rob taxpayer money and do nothing to help the unemployed," the release stated. "At this stage of opening the state 100%, the focus must be on helping unemployed Texans connect with more than a million job openings, rather than paying unemployment benefits to remain off the employment rolls."

Abbott's announcement comes just days after nearly 40 local chambers of commerce and business associations across Texas signed a letter to Abbott and TWC Chairman Bryan Daniel urging the state to opt out of the benefits program.

"We are hearing from out constituencies all over the state that finding and hiring workers in Texas in increasingly difficult," the letter reads. "Employers believe that supplemental unemployment insurance benefit payments from Washington are disincentivizing work and resulting in many good Texas jobs going unfilled. We believe it is time to realign government incentives behind the goal of rebuilding our economy together."

According to Texas Labor Market Information, the state's unemployment rate sat at 6.9% in March 2021—down from its 12.9% peak in April 2020. However, this is still higher than the state's prepandemic unemployment rate of 3.7% in February 2020.

For more information about unemployment benefits in Texas, click here. For more information about job opportunities in Texas, click here.