For the six months since the inception of the COVID-19-driven economic recession, tens of millions of Americans have interacted with the unemployment system. In the process, that system has been put to the test in every way imaginable. To get a sense of the magnitude of systemic and individual difficulty with these systems, TCF has analyzed the most recent data from the U.S. Department of Labor and the U.S. Treasury, and the numbers tell us that despite being many months into a historic volume of applicants, states have yet to figure out how to pay all eligible unemployed workers benefits in a timely manner.

The CARES Act provision that provided an additional $600-per-week in unemployment assistance (known as the Pandemic Unemployment Compensation, or PUC) also made the stakes of getting on unemployment insurance (UI) incredibly high. For those who were able to get the benefits, PUC offered a baseline of economic security that was then ripped out from under the twenty-five million people who had needed and relied on it. However, as we’ve shown, it hasn’t been a walk in the park for the twenty-five million who have applied for benefits since March. Since the beginning of the recession, more than one million individuals have filed for unemployment benefits each week, flooding state phone lines and web portals as they attempted, in some cases hundreds of times, to get their applications through. What can the data tell us about how the system is handling these steep technical demands, on top of the financial ones?

This piece is the third in a series tracking the effectiveness of state systems to process and pay unemployment benefits in a timely manner. We use monthly releases from the Department of Labor that track unemployment insurance payments, as opposed to the weekly releases that track (among other things) the number of people who apply for unemployment insurance, and those considered “insured” (who have been approved but not necessarily paid).

In the first piece, we showed that only 14 percent of initial unemployment insurance claims had been paid by the end of March. In the following month, we documented how, as claims continued to rise to historic highs, overwhelming most state systems, only about half—47 percent—out of 29.4 million initial claims from March and April were paid.

In the following analysis, the data we’ve used run through August, and are from the U.S. Department of Labor (DOL) for state UI payments and data we’ve used from the U.S. Treasury are through July, which incorporate payments through other UI programs like Pandemic Unemployment Assistance (PUA). Here are the key observations we’ve made.

The rate of payment has improved since April, but is still too slow.

The percentage of all claims being paid jumped from just below half by the end of April to slightly more than half—56 percent—by the end of August. This demonstrates the ongoing delays in payments that have continued to leave millions of workers waiting for life-sustaining benefits, despite a decline in payouts during the months since April (from peak new payouts of 12.2 million in April to 1.4 million in August).

In sum, 26.4 million people received benefits for the first time from March through the end of August, out of more than 47.5 million initial claims filed between the beginning of March and August 15. California accounted for 7.8 million first payments since March, and New York and Texas provided first benefit payments to 4.3 million and 3.2 million individuals, respectively. These initial claim figures remove those filing a subsequent claim, and thus represent those newly applying for UI. This means that there is a discrepancy of more than twenty million between individual claims for benefits and individuals who got paid in the end. These include those who failed to fulfill all the applications requirements (often because they could not talk with a staff member to resolve an unanswered question) who were denied benefits, as well as those who are still waiting for assistance. Oregon recently revealed that 49,000 workers alone were stuck in the adjudication stage with no decisions, and data from other states corroborate the idea that many workers have yet to be denied or approved.

Figure 1

Key states were still paying less than half of applicants by the end of August.

Many states failed to deliver at a payment rate matching the national average. For instance, Oklahoma and Georgia have continued to rank among the lowest in terms of the percent of claims that have been paid, all paying well below one in three (Minnesota and Montana remain low in our chart, but it is likely due to data reporting issues). By the end of August, Wisconsin, Missouri, and Arizona paid less than half of all the initial claims that have been submitted since March. New York and New Jersey paid roughly half of all applicants, and Pennsylvania, Michigan, and Illinois paid roughly two-thirds of all who applied since March. Many states have reported delays related to organized fraud schemes that have caused the need for additional reviews, and many have pointed to technical problems, but it’s disconcerting that after many months, states have not figured out how to get benefits to those who need it, and in a timely manner.

Table 1
Unemployment Payments That Have Been Paid, March–August 2020
State Percent of Initial Claims That Have Been Paid, March–August Total Initial Claims, March–August 15 First Payments, March–August
Minnesota 1.6% 750,610 11,961
Montana 5.4% 113,875 6,105
Georgia 30.9% 3,048,228 943,215
Washington 37.0% 1,347,390 498,182
Oklahoma 38.5% 821,338 316,119
Missouri 41.7% 749,829 312,611
Wisconsin 42.5% 692,781 294,571
Arizona 42.7% 850,862 363,461
Nebraska 43.7% 167,129 72,969
Maryland 45.7% 807,264 369,207
Kentucky 46.5% 781,790 363,540
New Jersey 47.0% 1,440,375 677,595
Alaska 48.0% 118,809 57,005
Idaho 48.2% 165,368 79,704
Indiana 49.8% 1,050,443 522,932
Delaware 50.0% 128,377 64,186
New York 50.3% 3,991,880 2,008,082
South Carolina 50.4% 663,417 334,255
Alabama 50.5% 704,198 355,900
Louisiana 51.4% 849,475 436,867
Wyoming 51.6% 49,449 25,491
Arkansas 51.9% 326,966 169,698
North Carolina 51.9% 1,289,821 669,348
Florida 54.6% 2,728,127 1,490,734
New Hampshire 54.9% 228,664 125,499
Puerto Rico 54.9% 443,139 243,095
Connecticut 55.4% 508,720 281,560
Ohio 55.8% 1,425,437 795,471
Texas 55.9% 3,111,826 1,738,214
Mississippi 56.2% 413,999 232,808
District of Columbia 57.3% 130,342 74,686
Oregon 61.2% 527,038 322,628
Utah 61.8% 208,939 129,026
Vermont 62.3% 114,620 71,393
Tennessee 62.4% 711,658 443,893
Hawaii 63.2% 274,559 173,426
Michigan 64.4% 1,743,718 1,123,730
Pennsylvania 64.9% 1,753,377 1,138,670
New Mexico 66.2% 198,593 131,417
Illinois 66.6% 1,453,316 968,552
Iowa 66.9% 384,178 256,867
Rhode Island 67.7% 176,187 119,244
Nevada 68.3% 594,601 406,191
South Dakota 68.6% 48,486 33,266
Maine 70.2% 169,571 119,026
West Virginia 70.3% 185,082 130,166
Massachusetts 71.8% 1,089,644 781,834
California 71.9% 5,940,836 4,271,950
North Dakota 74.4% 82,712 61,570
Kansas 75.3% 335,813 252,686
Virgin Islands 78.2% 7,672 5,999
Colorado 80.3% 518,251 415,928
Virginia 107.4% 1,052,058 1,130,262
Total 56.0% 47,470,837 26,422,795
Source: Department of Labor data and authors’ calculations
Notes: Virginia has a high number of interstate claims involving that DC and Maryland that skew numbers.

The implementation of Pandemic Unemployment Assistance has meant that a larger percentage of workers are receiving some unemployment relief.

The data reported in Figure 1 do not account for the Pandemic Unemployment Assistance (PUA) program, which provides assistance for those who are not eligible for regular UI benefits. In other words, some of those twenty million-plus people who applied to, but did not receive, regular benefits may have been paid through PUA.

As Ben Casselmen recently wrote in the New York Times, it’s impossible to know exactly how many people fall into this category due to inconsistencies in how states report PUA data, among other things. Thus, the numbers we report for the percentage of applicants who have been paid is a lower bound, since it’s based only on state initial payments and state paid claims, while some inevitably have been paid through PUA. Indeed, individuals can only receive PUA if they are ineligible for state UI, but states are not required to have PUA recipients go through the full UI application process. States have reported only eleven million first payments for PUA benefits as of August, so this only makes up less than half of the gap between initial claims for state benefits and payments. And it’s likely that many of the nineteen million initial claims for PUA never filed for state UI, and thus would not reduce the ratio.

Payment data reveal accelerating payments for those who move to the second stage of claims, reaching more than 80 percent of continuing claimants.

Another way to approach the question of what percent of applicants are receiving UI benefits is by looking at payment data from the U.S. Department of the Treasury. By law, both federal and state unemployment payments require regular transfers from the U.S. Treasury to the states, and these are reported weekly in the aggregate. These data can help fill in the gaps in DOL payment data. What we find when we look at the Treasury numbers is that total monthly payments accelerated each month starting in March, doubling from April to June, before falling back after PUC expired in July.

Given the average weekly benefit amounts provided by regular state benefits (approximately $340 in average weekly state benefits, plus $600 in PUC per week through July), the number of continued claims (482 million weeks insured, between state and PUA claims), and the total amount disbursed through the Treasury ($352.8 billion from April through July), we estimate that 83 percent of claims were paid from April through July—increasing from 73 percent from March and April. These data, presented in Figure 2 below, are higher than those in Figure 1 because they represent those who make it past the first stage of UI applications and file a continued claim. Part of the challenge in getting the full picture is in accounting for individuals who don’t make it past the initial claims (either because they are denied, unable to complete, or blocked) and part is because of those that do file continued claims but still don’t get paid. Individuals whose claims are pending because more information is needed, or, increasingly, because they are suspected of fraud are directed to file continued claims while they await a final answer. The waits have been excruciating, with one study finding that wait times for benefits were twice as long as usual—as long as sixteen weeks.

Figure 2


Final payments will begin to leave even more without benefits.

The pandemic-related economic crisis began more than twenty-five weeks ago. Most states pay a maximum of twenty-seven weeks of benefits, meaning those who were laid off early in the recession and received benefits promptly will be seeing their benefits expire soon, if they have not already. Furthermore, final payments are ramping up, according to the latest monthly Department of Labor data, reaching nearly one million in August (see Figure 3). Thankfully, through the CARES Act Pandemic Emergency Unemployment Compensation (PEUC), the federal government will cover an additional thirteen weeks of benefits. The latest weekly data from that program show that more than three million workers are receiving these thirteen weeks of additional support. However, PEUC is only payable through December 31, and estimates indicate that there will be more than four million long-term unemployed by then forced to make do with no guarantee of a safety net.

Figure 3

Looking Ahead

The data analyzed above indicate how badly states are still struggling with the unemployment backlog. To his credit, California Governor Gavin Newsom appointed an outside strike team to come up with recommendations for the unemployment filing crisis and committed to substantially reducing the backlog in the ninety days after the report released on September 21, and that new claimants won’t be impacted by a backlog. Other state leaders should follow California’s lead with thorough investigations of why claims are being processed so slowly, and a plan to deal with all pending applications. As the course of the pandemic and the economic outlook remain uncertain, it is critical for state unemployment systems to be able to quickly work through their backlog and ensure access to critical benefits.

header photos: A woman waits for a bus near a coronavirus testing site in Brooklyn in the Brooklyn borough of New York City. Source: Spencer Platt/Getty Images