This statement was published in response to the May 7, 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.
The Labor Department reported today that new unemployment claims remained at disturbingly elevated levels during the week ending May 2, as an additional 3.17 million workers newly filed for jobless benefits. In total, almost 34 million people have turned to unemployment since the start of the outbreak, representing more than 1 in 5 workers. Taken together, today’s numbers all but ensure that the April unemployment rate will surge toward depression-era levels, perhaps nearing as high as 20 percent.
While the number of new claims has steadily fallen for the fourth straight week, down from a peak of 6.6 million, the number of insured unemployed rose again to an all-time record of 22.6 million workers for the week ending April 25 (translating into an insured unemployment rate of 72 percent). In addition, the Labor Department reported an additional 1.1 million workers have filed for new pandemic unemployment assistance (PUA) benefits from the CARES Act over the last two weeks, showing that states are finally delivering aid to unemployed gig workers and students not covered by regular UI.
In other words, there is no dropoff in the numbers of Americans counting on an unemployment check to get by. Even with 72 percent of all initial claims having made it to insured status, many of these claims remain in ‘pending status’ limbo, with millions of American families awaiting payments as their states wade through the backlog.
The continued growth in these unemployment rolls is a harbinger of a catastrophic jobs report on Friday. With claims at these levels, it would be no surprise if payrolls shrunk by an all-time high of 20 million jobs in the month of April. The data point to an unprecedented cascading crisis that hit frontline services like restaurants and retail businesses first, but has now reached into every corner of our economy, from manufacturing to even the healthcare industry.
Unfortunately, even as the crisis builds, Congress is stalling in delivering additional critical aid to the economy. Washington has directed hundreds of billions of dollars into the Paycheck Protection Program (PPP), but this money has been fully exhausted while only reaching a fraction of employers. Congress needs to move on more streamlined and aggressive ways to keep people on payrolls while companies weather the economic storm, as well as invest in critical public health measures, such as robust testing and PPE, to safely reopen the country. The growing bipartisan interest in paycheck guarantees is one of the few bright spots in the dual public health and economic crises.