This statement was published in response to the February 3, 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 serves as yet another reminder of the steep hole facing the labor market and the importance of swiftly passing stimulus relief. For the 46th consecutive week, more than 1 million workers filed new claims for unemployment benefits (816,000 for regular and 349,000 for PUA). In advance of the January jobs report, the trend in claims for state benefits is promising, as new claims decreased for the second consecutive week (down 23,500 NSA), as did continuing claims for state benefits, which came in at 5.09 million (down 128,000 NSA).
While it appears that the worst of the pandemic layoffs may be behind us, the damage done to the jobs market will last for months, if not years. Claims for state benefits are nearly 2.5 times the level that they were at the start of the pandemic (and 8.6 times higher when all jobless aid is accounted for), and are currently as high as they were during the dark days of the financial crisis in March 2010.
While claims among those recently laid off are stabilizing, claims by the long-term unemployed continue to come in at sky high levels despite major delays in the delivery of stimulus payments.
- Claims for PUA benefits were down slightly last week to 7.2 million, just shy of the 7.4 million mark at the end of the year.
- PEUC claims dropped by a surprising 290,000 to 3.6 million, but this is likely related to the fact that 13 states still have not resumed paying out PEUC benefits. These numbers are sure to rise as more workers are able to get back onto this aid.
- Claims for the Extended Benefits (EB) program—primarily reaching those out of work for more than 9 months, and uninterrupted by the break in benefits—continued their upward trajectory, reaching 1.7 million (up 197,000) in the week ending January 16.
With such widespread usage of programs targeting the long-term unemployed, we can expect tomorrow’s January jobs report to show rising levels of long-term unemployment. Modest jobs growth appears to be in the cards as well, as rehiring remains far too limited for workers to escape pandemic unemployment benefits for a stable job.
With nearly 19 million workers filing new or continued claims for unemployment benefits, it’s clearer than ever that Congress needs to lock in extended unemployment benefits (with a $400 boost) until the end of September. States have worked valiantly to rapidly reactivate benefits after President Trump waited until they lapsed before signing the stimulus bill, paying out more than $10 billion in aid last week for the first time since August 2020. However, states and jobless workers are still catching up to $17.3 billion in promised stimulus that failed to reach workers in January. It’s a crisis that a new Congress and President can and should avoid repeating.