Another 2 million jobless: 17.2% of U.S. out of work
(CN) — Imagine everyone living in Houston applied for unemployment insurance benefits all at once. Last week, 2.43 million Americans filed initial claims for unemployment insurance benefits — a little more than the largest city in Texas — the U.S. Labor Department reported Thursday.
Amid the spread of Covid-19, 17.2% of Americans eligible for unemployment benefits are receiving them — about 25 million laid off workers.
The Department of Labor used covered employment of 145,671,710 in its calculation, defining that term as Americans who are “unemployed through no fault of their own,” while also meeting certain work and wage requirements.
On average 3.4 million Americans applied for benefits ever week over the last four weeks — cohorts roughly equal to the population of Connecticut.
Since mid-March, 38.6 million Americans applied for benefits. About 70% of that figure received them.
By Pew’s count, 17% of Americans lost their jobs and 23% received pay cuts from the pandemic. Some 43% of Americans report meanwhile that someone in their household lost a job or wages due to the pandemic.
The federal government found that Nevada faces the highest rate of insured unemployment in the country, followed closely by Michigan and Washington, all above 22%.
Two of the states leading the way for reducing economic restrictions reported the highest increases in applications last week: Florida with 48,222 new claims, followed by Georgia with 14,420 new claims.
Other states reported decreases in applications including California, Texas, and Oklahoma.
New York Federal Reserve economist Joseph Briggs projected U.S. unemployment will hit 40 million in the second quarter, but also said 75% of these jobs will return by the year’s end. Given today’s reported unemployment, that would leave more than 6 million people out of work during Christmas.
“We know the appetite for new workers has declined tremendously,” said Murillo Campello, professor of finance at Cornell University’s Johnson Graduate School of Management.
In an analysis of corporate job postings published on SSRN, Campello and his colleagues estimated weekly job postings dropped 57% over the last nine weeks. Businesses that are hiring are more likely to hire low-wage and low-skilled jobs, a trend called down-skilling.
“That means that workers of higher level of education and trade are not in high demand,” Campello said. “We need to have these people employed going forward. Dealing with technology and developing scientific advancements, we need a workforce to be prepared for innovation.”
The hiring market is also likely to favor employers rather than job-seekers.
“Once the demand is back, companies will be able to pick and choose way more. There is a big reshuffling happening right now,” Campello said. “Companies lay off most of the workers, then they come back and rehire the best workers. Companies use it as creative destruction.”
According to a Pew report published on May 15, 68% of people who lost their jobs or received pay cuts worry restrictions will be lifted too quickly, with slightly more Republicans than Democrats favoring a lift of economic restrictions.
Even in an increasingly partisan environment, valuing economic productivity and public health is not an either-or scenario, said Matthew Wilson, a professor of political science at Southern Methodist University.
“What people on both sides would tell you is of course, that they value both economic productivity and public health, but you’ve got to be realistic that there are certain trade-offs that have to be made.
“It would certainly be helpful if we could have common nonpartisan voices in our media,” Wilson said. “Telling people, ‘Hey, look, this is more serious than the flu, but this is not the bubonic plague. It’s not a hoax, there are some sensible public health measures that everybody needs to buy in on.’”
For some, the gamble of working amid the pandemic is worth the payout. Professional poker player Bryan Jenkins of Colorado Springs said he “absolutely has not” changed his lifestyle during the pandemic. As he awaits the reopening of casinos, “any restaurant that’s open for dine-in, I’ve gone out of my way to go there,” Jenkins said.
“If someone was afraid, that person can stay home,” he added. “I’m not saying that you shouldn’t wear a mask or anything like that, but it shouldn’t be forced upon you, this is supposed to be a free country.”
Others are learning to adapt their businesses to the times.
“People are like, ‘you can’t do that right now, because there’s a virus,’” said Gabriel, a Denver-based photographer who asked that his last name not be used. “I explain that I have a zoom lens and I’ll wear my mask. We can still social distance, and I can still take your photo.”