This statement was published in response to the September 17, 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 Labor Department report on unemployment claims again represents a major warning sign about the state of the economic recovery. A month and a half after Congress allowed the $600 per week federal benefits boost to expire, the crisis has yet to abate, rehiring is growing slowly, and the struggles of families and businesses continue to fester.
After falling more steeply in the summer, the number of workers filing unemployment claims has remained stubbornly high over the last five weeks. Last week, the total number of initial claims for unemployment came in at 1.45 million workers, including 790,000 state and 660,000 PUA–both representing modest declines from the previous week. These claims have been between 1.3 to 1.7 million for the last month, indicating that continuing waves of temporary and permanent layoffs have yet to subside.
Moreover, there were a total of 28.3 million additional workers filing continued claims for benefits. This includes 12.3 million on state benefits, down 6.7 percent from last week, representing a continuously high level for one of the most important and reliable indicators at this stage in the economy. Part of this decline is related to workers exhausting regular state benefits as we cross the six month line since the start of the pandemic. In fact, PEUC benefits for the long-term unemployed reached 1.5 million, increasing by 7 percent last week, and up 25 percent from one month ago. PUA claims (which continue to have measurement challenges) have remained high as well, as many people ineligible for regular UI are now collecting PUA benefits.
The high level of claims are coming as the patchwork provided by the temporary Lost Wages Assistance (LWA) program is wearing thin. Our updated analysis (see Table 1a on TCF’s data dashboard), finds that
- Already 7 states have exhausted all of the grants available to them (6 weeks of benefits), and this week Florida announced it would have to cut off aid early because of complicated federal matching rules
- The LWA program has only paid out $15.9 billion in benefits, which is equivalent to just 16.7 percent of what would have been delivered through the HEROES Act.
- Now, seven weeks after the expiration of PUC, 20 states have still not paid out benefits.
Clearly the LWA program is not up to the task or the size of our jobs crisis. Congress should use the time it has left before the House adjourns and restart PUC benefits and extend these aid programs through the winter of 2021.