This statement was published in response to the February 18, 2021 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 urgency facing Congress as it returns from a brief recess and continues deliberating the American Rescue Plan. After declining in previous weeks, new claims for state benefits ticked up above 850,000 last week for the first time since January 16 (+13,000 on a SA basis to 861,000). After a big jump in new claims for PUA (+174,000), total initial claims again topped 1 million (1.38 million) for the 48th consecutive week.
As of the most recent data, there are more than 18 million Americans—roughly one out of every nine workers—relying on unemployment benefit programs to endure the pandemic. This includes 7.7 million on PUA and 4.1 million on PEUC, figures that were both down this week but still above the levels at the end of 2020. Moreover, there were another 6.4 million workers, including 4.9 million on state benefits (-94,000 NSA) and 1.5 million on Extended Benefits (-197,000), who are receiving the $300 PUC benefit.
All of these pandemic benefits are set to begin phasing out on March 14—including the $300 PUC top off and the lifesaving PEUC and PUA programs—unless Congress passes an extension of aid before the deadline. With many workers enduring 3 to 6 week delays (or longer) after the tardy enactment of the last stimulus package, there is no reason for Congress to risk more interruptions by waiting until the last minute to act.
Taken together, these ongoing UI claims represent more than 11 percent of the workforce, covering gig workers, caregivers, and others who do not usually qualify for aid and who can be overlooked by government statistics. Unemployment claims data is a key reason that Fed Chairman Jerome Powell emphasized this week that the true unemployment rate is far worse than the headline 6.3 percent figure reported.
It will take months, through the summer and beyond, for enough re-hiring to occur to absorb all the workers still on unemployment benefits and the steady stream of new applicants. Robust pandemic aid is precisely the medicine the economy needs to get Americans back where they want to be: at work