This statement was published in response to the December 30, 2020 release of jobs numbers by the Bureau of Labor Statistics. For the most up-to-date data please visit TCF’s comprehensive UI data dashboard here.
Today’s Labor Department report underscores the high stakes of our public health and economic response to the COVID-19 crisis. After peaking in early December, new claims for unemployment benefits eased back to 1.15 million (down by 120,000, on a non-seasonally adjusted basis). Still, new claims for state benefits are up by 17 percent on a non-seasonally adjusted basis (up 9.9 percent SA) since bottoming out at just over 700,000 on November 28. With fears of a new, more contagious strain of the virus spreading, the labor market badly needs a swifter implementation of the vaccine program in order to safely re-open the economy in 2021.
Today’s report is the last of 2020, which saw week after week of immense layoffs, furloughs, and subsequent unemployment claims. The first claims release of 2020 on January 2 showed a total of 1.83 million workers filing continued claims for benefits (as of December 14, 2019). Today’s release shows a total of 19.29 million continued claims—including 8.46 million on PUA, 5.26 million on regular state benefits, 4.77 million on PEUC, and 800,000 on EB. That’s more than 10 times what was reported at the start of the year, and nearly twice as many than at the end of the worst year of the financial crisis in 2009, when 9.9 million were relying on UI benefits, including 5 million on regular benefits and 4.4 million on extensions.
For those on the short end of the stick of the unequal COVID recovery and forced to rely on meager UI benefits, news from Washington has been mixed. A major benefits cliff has been averted, and the number of workers collecting PEUC benefits (down 20,000 last week, as people started to roll off the program) is likely to increase as additional weeks are added to the accounts of all those who ran out of PEUC and who reach out again for aid. The same is true for PUA, which dropped by 800,000 from December 5 to December 12.
On a positive note, the Labor Department has confirmed that jobless workers won’t lose out on a week’s worth of benefits due to President Trump’s delay in signing the relief bill. The additional $300 per week FPUC top off will start reaching workers in 2-3 weeks in many states, and the combined value of the relief package is nearly $7,500 for jobless workers, according to our estimates. Unfortunately, fervent efforts by House Democrats to increase the across-the-board stimulus to $2,000 have been blocked by Sen. McConnell in the Senate. This money could have helped jobless workers pay back debts incurred while FPUC was expired, providing a financial cushion in light of the very short period of unemployment benefits.
The sudden debate and popular support for increased stimulus checks has underscored just how acutely Americans feel the economic damage of 2020 and fear the uncertain period ahead. While Congress has taken the first steps to avert the worst of the unemployment crisis, the need for additional jobless aid won’t end as the year turns over.