This statement was published in response to the June 4, 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.
Earlier this year, 1.88 million new unemployment claims in one week ( ending May 30) would have seemed catastrophic. Today, it’s a small respite in a sea of unending bad news, with new weekly claims falling below the two million mark for the first time since the week ending March 14.
Still, the decline in initial UI claims should not obscure the deep crisis of joblessness going into Friday’s calamitous jobs report. Taken together, today’s data indicate that at least 33 million Americans were unemployed at the end of the month of May. This includes nearly 3 million new applicants for state and federal benefits, 10.7 million who are continuing to claim federal benefits, and 19.3 million who are continuing to claim state benefits. The most recent data indicate that 880,000 more workers started federal pandemic benefits in New York and more than 400,000 started in Massachusetts and Michigan.
Continued claims represent a critical barometer of progress and rehiring as the economy reopens. Given these extreme figures (which represent 19 percent of the total labor force), it’s likely that tomorrow’s jobs report will represent a nadir in recent US history, with the unemployment rate potentially reaching, or even exceeding, 20 percent.
Despite multiple states reopening, seasonally adjusted continued state claims actually increased by 3.1 perecent between the weeks of May 16 and May 23, and they increased by 3.8 percent for federal benefits. Today’s data show that there has been some modest progress in rehiring: a 13 percent drop from the peak of insured unemployment on May 9. We estimate that 73 percent of all continued claims have been paid, translating into $93 billion in benefits paid in the month of May alone.
At this pace, unemployment benefits will continue to shoulder much of the burden of bolstering spending power and securing families’ economic well-being as we enter into the summer. Unfortunately, this critical aid is at risk of coming to a crashing end if Congress doesn’t act. Most of the benefits being paid now are due to the CARES Act, and the biggest portion of that aid, a $600 weekly boost for jobless benefits, is scheduled to sunset on July 31st. Pandemic Unemployment Assistance (PUA) coverage could end by the end of the year as well, if eligibility definitions are not changed. Already, 200,000 workers are relying on extended benefits and many of these workers—and millions more—will run out of benefits by December 31st. Congress must ensure this does not happen.”
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