This statement was published in response to the September 30, 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 underscores the urgent importance of legislation being pushed right now in the House of Representatives to aid millions of workers depending on unemployment assistance. All together, there were 26.5 million claims for unemployment filed last week who would stand to benefit from the new package, which would restart the $600 per week PUC benefit, add additional weeks of extended benefits to the long-term unemployed, provide an extra $125 per week to multiple job holders, and enforce stricter oversight of historic backlogs of benefits. Negotiations in Congress have rekindled hope for unemployed workers that additional aid can reach them before the election, and before long spells of unemployment inflict lasting financial scars on them and their families.
Last week, 1.4 million individuals newly applied for UI benefits (787,000 regular and 650,000 PUA). Historically high initial claims—down by only 6,000 from last week—continue to send major warning signs about the occurrence and recurrence of unemployment even as major parts of the economy seek to reopen. The latest data indicate that likely more than one in three initial claims being filed in the states are among people reopening a claim after initially going back to work and off of unemployment. The other two-thirds represent the continued undertow of layoffs, such as the announcement by Disney this week that it would lay off 28,000 employees, and the looming layoffs of thousands of pilots, flight attendants, and other airline workers due to the expiration of federal protections.
Today’s report provides the last new piece of data leading into the highly anticipated monthly jobs report tomorrow. It’s important to note that the number of continued PUA claims came in at 11.8 million this week, but this is skewed by a two-week freeze in claims in California caused by the need for the Golden State to intercept organized fraud attacks (DOL has attempted to adjust for this in the initial claims data). Moreover, large numbers of parents who can’t work because of child care requirements may be collecting PUA but don’t count as unemployed.
As such, regular state benefits and PEUC extensions for those who reach the limit on state benefits provide the best indicator ahead of the unemployment rate released tomorrow by BLS. The number of workers on regular benefits and PEUC combined was 14.1 million for the week ending September 12. That’s only 7 percent below what it was four weeks ago, when the August jobs report was calculated, far less than the 15 percent decline in continued claims from mid-July to mid-August. These figures presage a much smaller decrease in the unemployment rate in September than we experienced in August.
The CARES Act has lowered the level of unemployment and reduced the negative impacts on families. It is not too late to extend that assistance.