This statement was published in response to the June 11, 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 unemployment report confirms two critical facts: that the unemployment crisis is slowly improving, but that benefits will continue to play an essential role in the recovery for months to come. In the week ending June 6, 1.5 million Americans filed initial claims, bringing the post COVID-19 total to a record 42.1 million claims. New layoffs are slowing, too: weekly initial claims are down by 78 percent from the peak of 6.9 million on March 28.
In contrast, the process of rehiring and exiting unemployment benefits is much slower. The number of workers making continued claims for unemployment benefits fell to 18.9 for the weeks ending May 30, which is down just 17 percent from the peak of 22.8 million on May 9. At the rate of decline last week (-178,000), it would take more than two years (106 weeks) to get back to the pre-COVID rate of unemployment. Similarly, those claiming federal benefits for gig work and others impacted by COVID-19 but not eligible for state benefits were down just 11 percent from last week’s record total of 10.9 million, with 11 states still not reporting data from a program that Congress authorized more than two months ago. Not coincidentally, the states not reporting continued to be those in thes south (including Florida, Georgia, Arkansas) with restrictive UI programs and large working-class Black populations.
Indeed, when federal pandemic unemployment benefits are included, there were a total of 30.9 million claims for unemployment last week, representing 19.7 percent of the labor force. Claims data prove that the labor market’s strain on the economy is significantly greater than the 13.3 percent unemployment rate reported last week by the Bureau of Labor Statistics. The timely expansion of unemployment benefits means that millions of Americans who are fully or partially out of work are collecting benefits but not counted as officially unemployed. This includes 4.9 million workers who are counted as ‘employed but absent,’ and who could be collecting UI if they are not being paid by their employer. Not to mention, an additional four million Americans who’ve dropped out of the labor force because of the lack of jobs to look for, or the lack of available child care, could be collecting UI benefits under special CARES Act and state rules.
Looking past the confusion and controversy of the unemployment rate, millions of Americans continue to count on federal and state unemployment benefits to pay the bills now and in the difficult months ahead, as the economy climbs back to a semblance of normalcy. Without federal benefits, however, most of these workers would be forced to rely on benefits equalling only a few hundred dollars (or nothing at all, if they are self-employed). This includes a half-million workers now receiving extended unemployment benefits (PEUC), more than double the number last week. The extra $600 per week benefit for all workers, as well as the special pandemic unemployment assistance, represent a thin line between homelessnes, hunger, and financial ruin for the unemployed. Congress cannot afford to play Russian roulette with these benefits and should ensure the continuation of expanded aid past the July 31 deadline.