Among the many crises precipitated by the COVID-19 pandemic, the economic collapse and the resultant massive unemployment are uppermost among the public’s minds. The unemployment rate soared to 14.7% in May 2020 from below 3% in December 2019. As jobs have been a much-discussed issue even before the pandemic struck, everyone is wondering what the unemployment rate does not tell you.
Many experts had argued that the low unemployment rates before 2020 were not accompanied by commensurate increases in real wage growth. The pace of GDP growth has also not been in step with the number of jobs being added. The male prime-age employment-population ratio is not as high as it used to be pre-2000. How much can we rely on the unemployment rate estimates alone?
The unemployment rate is defined as the percentage of the labor force unable to work and find a job. However, other unemployment rates account for different dimensions of the same labor force that many economists think gives a more accurate indication of the real state of jobs. To understand what the unemployment rate hides from us, let’s begin seeing how it’s calculated.
How Is The Unemployment Rate Calculated?
The unemployment rate data comes from the Current Population Survey (CPS) that the US Bureau of Labor Statistics conducts every month. This survey takes information from a representative sample of 60,000 households that translates to about 110,000 individual interviewees. The sample is designed to represent every US state. It is customized for each state such that major geographic and economic divisions such as rural/urban areas, farming/non-farming areas, industrial areas, etc. are taken into consideration.
One-fourth of interviewed households are changed every month to keep the sample adequately representative. No single household gets interviewed for more than four months in a row and then gets left out for eight months. The same thing happens in the next calendar year, and then the households are excluded permanently. This rotation and repetition improve the reliability of the estimates.
The data is then extrapolated to the total population, and there are many weights taken to minimize distortions and sampling errors. The interviewers are also thoroughly trained as the survey’s results must be obtained by following uniform procedures.
Who Is Considered As Employed?
The surveyors ask the respondents various questions to determine their employment status. Anyone with a job, whether part-time or full-time, is considered employed. Those who don’t have a job but want one and are actively looking for at least four weeks are considered unemployed. The person must be over 16 years of age.
Here is a thorough list of the other considerations made when deciding whether to count a person as employed:
- Only those engaging in active job search methods qualify as unemployed-sending resumes, contacting employers, making helpful connections, placing job search advertisements, registering with job agencies, etc.
- Attending any professional training program doesn’t make one unemployed
- Running a business or contributing to a family enterprise for at least 15 hours also counts as being employed, though such people may be classified as unpaid family laborers or contractors
- One is employed even if he or she is not going to work for any reason, such as illness, caregiving, etc.
- Being on a temporary layoff will count towards being classified as unemployed, even if he or she has a recall date. one will be counted as employed for a reference week if he or she was paid for a few days and then lost his or her job
The Different Unemployment Rates
The statistic we are all most familiar with is the U-3 unemployment rate that the BLS reports every month in the Employment Situation. This value is the number of jobless people who are actively engaged in seeking employment, i.e., made efforts in the preceding four weeks.
The U-6 unemployment rate is another measure which counts the number of people who have been on a job hunt for the preceding 12 months, but was unable to find one, called the marginally attached. It includes those who are working part-time but would like full-time jobs ideally. The CPS survey doesn’t account for them.
Other methods of calculating labor underutilization:
- The U-1 unemployment rate is the percentage of people who have been unemployed for 15+ weeks in the labor force.
- The U-2 unemployment rate calculates the number of people who have lost jobs and/or completed temporary jobs as a percentage of the total labor force.
- The U-4 unemployment rate is the percentage of unemployed people and discouraged workers in the total labor force, including discouraged workers. Discouraged workers are those not currently looking for work due to the job market’s vagaries, such as the disabled or those without the right skills.
- The U-5 unemployment rate is the percentage of unemployed, marginal, and discouraged workers among the total labor force and the marginal labor force.
U-1 and U-2 are narrower measures of unemployment rate than U-3, the official figure quoted most often. U-6 is the broadest measure and is therefore thought to be a more accurate representation of the job market’s state.
What Does U-3 Unemployment Rate Not Tell You?
Changing Nature of the Job Market
The U-3 unemployment rate makes it near impossible to analyze how the job market has evolved over the years as it doesn’t account for the changing nature of the population. A predominantly young population may have higher unemployment numbers due to job-hopping and dropping out for better quality jobs. A predominantly older population may also experience ageism.
You will have to use other indicators to figure out how the contributing economic sectors have changed and how much skill the new jobs require.
A lowered unemployment rate may be due to a spurt of temporary, short-term hiring, as the government did during the pandemic to deal with the high volume of unemployment insurance claims or conduct census or elections. The job quality is not apparent from the U-3 unemployment rate as it also counts the numerous entry-level or casual positions that may not provide much scope for future growth.
Underemployment And Being Shut Out
The U-6 unemployment rate is a better indicator for this particular reason. Many people are forced out of the job market due to skills mismatch or discriminatory policies. They may give up after having searched for jobs for a long time.
Many workers may take up employment not matching their skill level for various reasons, typically a recession when there is a decrease in demand for skilled workers. It may also occur due to massive structural changes in an industry, such as adopting new technology or automation.
The part-time employment figures have been persistently high over the years and are presently higher than the implications of the BLS U-3 rate.
Even before the pandemic, the fastest-growing job-creating sectors were retail trade, food & drinks, sales, etc. where most part-time jobs concentrated. This fact belies the creation of high-quality jobs that can sustain the workers’ aspirations. During the pandemic, these were also the sectors that took the biggest hit except for supermarkets and e-commerce retailers.
It is not possible to accurately estimate the number of unemployed workers with all the nuances thrown in. The actual unemployment rate is likely much higher than even what the U-6 rate indicates. These values have to be considered along with other indicators like gendered labor force participation rates and education enrollment and completion rates for a comprehensive picture of the job market. As the economy evolves, new indicators would have to be developed.
Sally, the first hurricane to make landfall in Alabama since Hurricane Ivan in 2004, strengthened to a tropical storm after making landfall near Miami, Florida. The tropical storm slowly garnered strength until it was given Category 1 status and intensified into a Category II hurricane, on the same evening.
The hurricane brings almost 61cm (2ft) of rains and winds ranging to 85mph (135kmh). The National Hurricane Center (NHC) stated that Sally might cause “historic flooding” and “extreme life-threatening flash flooding.” In addition, widespread flash flood, severe thunderstorm, and tornado warnings were issued.
Hurricane Sally’s harsh downpour will most probably damage numerous buildings and cause power outages leaving people, at least for a while, out of places to work. As the states bordering the Gulf Coast engage in preemptive measures to safeguard their citizens, another detrimental consequence tends to be the loss of employment.
How Are States Preparing To Cope With Sally?
The coronavirus pandemic still continues to challenge the stretched resources available with the states. They are having to allocate more funds and manpower to deal with Hurricane Sally. Here is a look at how the states bordering the Gulf Coast are preparing for the impact:
In preparation for the upcoming hurricane, the governor of Louisiana declared an emergency across the state, that is still reeling from Hurricane Laura’s effects. Public schools and universities were canceled, and shelters were opened.
Kay Ivey, Alabama’s governor, issued evacuation orders to flood-prone and low-lying areas and closed off all the beaches on the coast. An emergency was also declared in Alabama in preparation for the approaching storm.
The Mississippi governor, while declaring the emergency, urged citizens to prepare for Hurricane Sally. As the rain could be very heavy in the southern parts of the state, some mandatory evacuation orders were issued. Shelters were opened for evacuees.
The respective governments are taking measures to mitigate the effects of the damage caused by the hurricane. They are likely to take funds from the Disaster Unemployment Assistance to take care of their unemployed citizens.
Impact Of Hurricane Sally
Gusts of up to 105mph, relentless rainfall, and a growing storm surge ravaged buildings, boats, and hurled debris around Alabama. Trees bent over, almost three feet of water submerged the vehicles parked on the roads, and over half a million consumers were left without power as the winds knocked down power lines. Videos doing rounds on social media depict the severity of the considerable damages caused by the hurricane.
Jackson County in Mississippi was victim to most of Sally’s flooding. A power outage was experienced on the eastern side of the city. More than 10,000 people had no power during the storm’s peak stage.
Dauphin Island in Alabama experienced storm surge flooding but Orange Beach was the most affected by the flooding.
Several condos in Gulf shores were damaged, with a few completely destroyed. A gas station was reported to be destroyed in the Spanish Port area.
Most of the major structural damages were recorded at Mobile and the Gulf Shores.
Sally’s asymmetrical nature caused continual thunderstorms and showers since September 12. Multiple tornado warnings were issued across Florida. Special marine warnings indicative of hazardous marine conditions were also issued for the Florida coasts. Florida’s Panhandle area bore the brunt of the storm.
The south part of Lake Pontchartrain in Louisiana overflowed because of Sally’s winds. Two tornadoes were reported in Georgia. Rincon and Eastover, South Carolina, also witnessed a tornado.
Hurricane Sally’s Effect on Unemployment
Even as Sally weakened to a tropical depression, it has caused substantial damage to life and property. We are yet to see how Sally will impact the economy of the local areas. The hurricane may boost the U.S. joblessness claims that are already in millions because of the Coronavirus pandemic. The situation in the U.S. does not look favorable to people who are already facing unemployment.
Many businesses have already closed down, heeding the warnings issued. It is going to be difficult for them to recover even after the hurricane. It is likely that some businesses will survive the loss of revenue, but the employees who depend on their daily or weekly wages will be the hardest hit. The hurricane’s impact on the job market will be detrimental to the local employees.
Federal Response To Hurricane Sally
President Trump gave his consent to declaring an emergency in Alabama, Louisiana, and Mississippi. This declaration sanctions the Federal Emergency Management Agency (FEMA) to offer protective assistance and measures to the worst affected areas.
Incident Management Teams from FEMA were deployed to Louisiana, Mississippi, and Alabama to ensure no unmet needs. Additional teams from the Departments of Energy, Transportation, Defense, Health and Human Services, and others are preparing to provide further supportive measures to affected states and tribes.
The U.S Department of Labor set up the following special assistance programs for the unemployed:
- A collaborative effort by the IRS, U.S. Department of Treasury, Pension Benefit Guaranty Corp, and the Employee Benefits Security Administration (EBSA) is planning to release compliance guidelines for employee benefit plans and decide the beneficiaries and participants as a mitigative measure to Sally’s effect on workers.
- The Office of Workers Compensation relaxed the refill restrictions on medication for injured workers displaced as a result of Hurricane Sally.
- The Employment and Training Administration is gearing up to provide Disaster Dislocated Worker Grants to help the workforce in the affected states.
In situations like this, filing for Unemployment Insurance (UI) may help them make ends meet. If one does not meet the criteria required for this, he or she can apply for the Hurricane Disaster Unemployment Assistance (DUA) program. The unemployment benefits due to the hurricane can be collected for up to 26 weeks since the government’s DUA announcement.
If you have access to the internet or even books, the coronavirus quarantine is a good time to learn new skills. It is frustrating and heartbreaking to lose your job, but all you can do now is collect your unemployment benefits and figure out what would be the next best move for your life. Like it or not, jobs of the 21st century and onward will demand computer literacy. We will list out some of the computer skills for jobs of the future.
Why Learn Computer Skills
Everything is moving towards computerization. From the capital markets to healthcare database management, from teaching to food and accommodation business inventories, computers are everywhere. Orders and administration, sales, legal teams, etc. everyone is onboard the internet revolution. There are lesser and lesser jobs that don’t demand computer skills.
Computer programs can revolutionize your personal life as much as it has changed businesses. You can use simple software and programs to manage your expenses, taxes and even handle your own investments. Cloud-based storage solutions can help you to maintain those pesky bills and receipts permanently with no fear of losing track of them.
There are a whole lot of upcoming fields in computer science which even universities are just now starting to offer courses in. The best way to learn them actually happens to be through online courses by professional organizations. Many people have managed to make lucrative careers by self-learning these skills.
Many companies spend time and money training new recruits on these skills. Imagine the edge you will have by going in with them already in your repertoire. Although some of the jobs requiring these skills may prefer those with degrees, there are many who have attained success by acquiring them by self-learning.
Python, the programming language has three core applications:
- Data Science — including machine learning, data analysis, and data visualization
- Web Development
The above fields are larger domains facilitated by the knowledge of programming languages. Not only do you get jobs by knowing these skills, but you can also start your own web-based businesses.
Harvard University is offering a free online course teaching the basics of python.
This field is a subset of artificial intelligence. It is quite complex to learn, but successfully doing so can launch you into a great career, precisely because it is still a relatively rare skill.
It now powers many of the modern-day services like streaming platforms, e-commerce sites, media players etc. where data is quickly sorted through to determine what you might like.
A comprehensive machine learning program will also impart allied skills such as statistics.
A good resource to explore this skill is Coursera, where you can audit courses for free.
While not strictly connecting to computing, this tool required by business analysts can make you a great fit for business development roles. You can learn PowerBI on Youtube as well as LinkedIn Premium
Google Office Tools
Google is providing stiff competition to Microsoft with its suite of spreadsheets, presentations, etc. software. Acquiring these skills provides you with an entry point to many promising careers. Its much quicker to learn than AI, ML or any such broader field.
These are very lucrative skills nowadays and there is a lot of demand for freelancers as well. Developing a portfolio of work really helps. There are numerous paid and free resources to learn from, but paid resources might be better if they include a capstone project. Coursera has some design courses you can audit for free.
This career goal is a good idea for those who are artistically oriented. It involves transforming data into a visually appealing form. EdX has a free course that you can also get a certificate for by paying extra.
There are many other advanced courses you can opt for in Data Science and Artificial Intelligence if you already have some knowledge of computer science.
Though the world looks hopeless when you have been laid off, it might just take you in a direction you never thought of. Make sure to collect your unemployment benefits and try your best to stay positive. The government is charting up plans to slowly restart the economy so, we will see a future outline soon.
The coronavirus quarantine is one of the most worrisome times in modern American history. Not only do we all have to contend with a virus that kills people but also with the largest global economic slowdown where we cannot even work if jobs were aplenty. The longer the lockdowns continue the harder it is becoming to visualize what the future might look like. We don’t know how long it will take for the massive numbers of unemployed people to find jobs again.
So the question remains as to what can we do to mitigate stress in these uncertain times? How can we increase our chances of getting employed? One excellent option is to use the time and resources made available to upskill during this quarantine period for better job prospects.
Several websites and organizations are giving free access to online courses during the pandemic. This is of great help to people who are in or were thinking of entering a new domain. It also helps you learn skills that make you a better fit for jobs with good growth prospects.
Free/Affordable Courses Available Now
We have compiled a list of some free or low priced courses that also have a good chance of being recognized and accepted by employers. You can use them to upskill or just gain an idea of whether a career would suit you before making a plunge with a more expensive professional qualification.
Harvard EdX Courses
Harvard is offering 64 of its courses for free, during the quarantine period. Their catalog includes the following courses offering very relevant skill training:
- Game Development
- Mobile App Development
- Computer skills for lawyers
- Nonprofit Financial Stewardship
- Data Science
- Introductory Artificial Intelligence
- Contract Law
Coursera online courses, unfortunately, require payment to obtain a recognized certificate, but one can audit their courses for free. There are several companies though that are more concerned with people possessing requisite skills than paper degrees. They have numerous courses from the faculty of extremely reputed universities including The Wharton School, UPenn etc. They even offer curated programs leading to an online Bachelor’s and Master’s degrees.
A few courses are freely available to deal with COVID-19.
The courses that are quite in demand nowadays are:
- Business Analytics & Development
- Software Development and Web Development
- Health Informatics
- Cloud Computing
- AI applications
Free YouTube Videos
There are numerous free resources available on YouTube to learn high-demand skills such as marketing, search engine optimization, analytics, etc. Many leading companies also provide free professional development course snippets.
The platform offers free and paid courses in diverse fields from leading professionals who act as mentors. There are courses in marketing, finance, photography, social media marketing etc.
You can also consider developing soft skills in communication, negotiation, statistical skills etc. These skills are foundational to any professional success and are often transferable when you attempt to switch careers.
This can be a taxing time especially if you have lost your job. While you apply for unemployment benefits, keep yourself occupied by indulging in some self-care and self-improvement. Try not to think about outcomes you cannot control.
We have previously taken a look at the states with the largest number of UI claims with regard to their progress in with the new unemployment insurance systems. Since then, there have been reports of a lot more people starting to receive their weekly entitlements in those states. But some states have not yet started implementing the new UI benefits rules.
In this post, we will take a look at the states that seem to be having the worst time coping with CARES Act implementation and take a look at the most common complaints people have about them.
Common Problems Faced By All States
The US never before faced such a large volume of unemployment claims with over 15 million people filing. Many states had in fact cut back their unemployment compensation systems due to the good economic growth and historic lows in unemployment rates. They are thus swamped and experiencing the following:
- Servers overloaded with requests
- Jammed phone lines
- Staff shortage
The Coronavirus Economic Security Act took care of the state unemployment trust fund insolvency by giving agreeable states, funds for the Pandemic Unemployment programs. Now let’s look at the states whose citizens are having the roughest time.
This state has been facing flak for its slow response in handling the large number of UI claims. Official data shows more than 470,000 filings so far, but the number is an underestimate as numerous people haven’t even been able to open an account or reach out to a worker over the phone. Florida has contracted out technological upgrades and hired call centers but thousands of people report being unable to access the website.
Many who were able to file claims are frustrated at being unable to see their determination status or have no idea when they will receive benefit payments. Florida’s economy is in worse shape than other states due to its reliance on tourism which is unlikely to resume even after lockdown ends. The state had also reduced benefits and payment weeks over the years.
Ohio’s Lt Governor Jon Husted said that the state needs to hurry up with topping up the state unemployment trust funds because it will be unable to handle the volume of claims at this moment. The Ohio Department of Job and Family Services has declared that people may start getting UI benefits tentatively from next week. It may be early May by the time the self-employed and part-time workers and others previously ineligible for unemployment compensation, may be able to have claims successfully processed.
The state website has been outdated for years and is thus unable to handle the influx of people. The state is attempting to upgrade it, but more effort is needed.
Though Ohio has been hiring staff and getting deputed employees they have insufficient training resources. This will put many people with barely any savings in great inconvenience.
This is another state lagging behind on unemployment claims processing. Many people newly eligible for UI benefits such as the self-employed, those furloughed or not receiving pay due to COVID-19 etc. Even people who successfully filed benefits in mid-March have reported not receiving payments etc.
Washington like other states is scrambling to hire people to man the call centers. They need to upgrade the system which is reportedly unable to handle the new calculations due to the changs from the CARES Act. The date for expanding UI officially through the CARES Act has been set at Apr 18th.
The state has at least passed a ban on eviction, bringing welcome relief to people out of jobs.
Other States Having Almost Identical Problems
- Virginia– Not executed the Pandemic Unemployment Assistance program yet. It has missed two promised deadlines of Apr 7th to announce details and Apr 10th to start enrolling eligible workers to PUA
- Oregon– System underwent a glitch that may not have been fully fixed as people are asked by it to restart their claims process. The state has not legally waived waiting week requirement yet.
- Missouri– The state has not indicated a timeline yet for when PUA payments could start going out, as it remains swamped by UI applications.
- Maine– $600 payments are yet to be started. The governor has passed orders to restrict evictions.
Some states are in talks over the limited reopening of a few economic sectors and companies. This might reduce the unemployment situation marginally, but is going to be of limited use. Many people are employed in accommodation and food services as well as manufacturing, which provides the purchasing power to fuel the spending in the country. The states will need to speed up on implementing UI benefits.
For those lucky enough to still be employed, the Coronavirus pandemic launched the world’s biggest work-from-home experiment (WFH) as employers everywhere were forced to shutter offices and plants by government orders. Working from home has allowed many companies to remain operational during his difficult time which is causing massive layoffs across sectors such as entertainment & recreation, food services, even healthcare, etc.
People have various reactions to this new normal. Let’s look at the various advantages and drawbacks of remote work as we wait to see if it becomes a larger part of the normal economy.
How Work-From-Home Was Viewed
Remote working has grown by volume over the last decade and has even proven lucrative for certain freelancers and contract workers. Once a preferred mode of work for stay-at-home parents, it is now an option given even to full-time employees of big organizations, a few times a month.
Remote working had its fair share of detractors once. It was seen as unsuitable for more than a few employees, due to the difficulties in communication and coordination. Employers also had the impression that employees were less productive when not in the office and surrounded by co-workers.
There is also the difficulty in executing remote work when the tasks require tremendous communication. Nuanced, non-verbal cues are extremely important especially when we consider operations such as sales and legal discussions.
Advantages of Work-From-Home Jobs
Remote work has spurred unprecedented revenue growth for companies like Zoom which provide teleconference tools. Many others including the famous Google Services have scrambled to take advantage of the opportunity by quickly upgrading their offerings.
Consequently, these happen to be some of the few types of organizations that are still hiring.
A famous study by Stanford University on a Chinese company called Ctrip yielded huge positives in favor of remote work in 2015. The firm saw a 13% jump in productivity and a 50% rise in employee retention rates when 1000 workers were sent to work from home. The company soon adopted a remote working policy for nearly all teams.
Remote work has long proved a blessing to prospective parents, giving women requiring longer maternity healing a chance to remain in the workforce. By the same logic, it has also been helpful to those bound at home due to cultural restrictions as well to some people with disabilities.
For employers, the possibility of hiring skilled workers across the world without bearing relocation costs is a very attractive prospect. Therefore, there are now many upcoming job portals focusing on connecting employers to freelance and remote workers. Companies can potentially save on office space, promoting the concept of open and hot desks.
Similarly, it gives employees the flexibility to choose their bosses. Remote work also helps in reducing productivity loss due to long commutes, office politics, personality incompatibilities, etc. It may also make rewards and appraisals fairer by basing them on the accomplishment of outcomes rather than time spent or politics.
Those companies that have been able to transition to remote work are largely in the software services industry, media content creation and other such sectors where there is no tangible product creation. However, this is a result of the nature of the economic shutdown imposed by the pandemic.
Drawbacks Of Remote Work
Working from home is obviously not possible for jobs that involve manual labor, face-to-face consumer-grievance redressal, delivery services, etc. Physical distancing requirements have forced even those organizations to close down that could have managed with transitioning a percentage of the workforce to remote work.
The manufacturing sector cannot transition most of its workforce to remote roles. This is also the case with defense and aerospace companies which have confidentiality requirements and need employees on-site.
The productivity of a work from home employee depends largely upon the efficiency of communication tools adopted by their employers. Without hi-speed internet and investment in scalable technologies, the work from home experiment can challenge patience at the least and retard work at the most.
The Ctrip experiment was successful in part due to the employees having uninterrupted working hours. This is not a possibility now due to the closure of schools. Even then many employees reported a desire to commute to work after a few months. Working from home can breed social isolation and negatively impact mental health without a strong social support circle.
The immediate aftermath of COVID-19 will consist of some paranoia over hygiene and many employees may want to work from home for longer, when possible. But it is likely that many companies will expand remote working roles and profiles in the future. People can expect more work-from-home days in a month. The world’s biggest work-from-home experiment will have lasting changes.
All this comes however after the economy goes back to normal and people are able to return to their regular jobs. If you have been furloughed or laid off, apply for unemployment benefits as quickly as possible.
As a sector dominated by gig workers and contractors, unemployment in arts, entertainment and recreation sector has been drastic, next only to the accommodation and food services sector in scale. Sub-sectors include performing arts, museums, theatres, amusement parks, gambling arcades, stage shows, fitness centers, spectator sports, etc. The movie industry also comes under this sector.
Many states have declared shutdowns affecting footfall to these venues while they have voluntarily closed down in many places to avoid being a hotspot. We shall take a brief look at this sector to understand the prospects with coronavirus and what former employees can expect in the near future.
Overview Of Arts, Entertainment, and Recreation
This sector employed about 2,481,500 people in 2019 and 2.46 million people in March 2020 according to the Bureau of Labor Statistics. The current unemployment rate is 8.6% but it has been historically at an average of 4.6% over the past year.
The top occupations in this sector are fitness trainers and instructors, entertainment attendants and other workers as well as janitorial staff. The largest number of employees are amusement and recreation attendants. Employees earn an average hourly wage of $15.87. Many are employed and paid on an hourly basis in this sector.
There is a wide disparity in the wages of on-screen personas vs behind-the-screen staff in the case of the film industry. The working hours’ number a minimum of 24 per week on average.
The entire market was valued at approximately $336 billion.
COVID-19: Unemployment In Arts, Entertainment, and Recreation
Most businesses in this sector are deemed non-essential and have been closed down by government orders. This sector will thus face a huge decline in revenues in this second quarter of 2020 (provided the coronavirus recedes after that). These businesses have furloughed low-wage employees and imposed pay cuts upon more skilled workers.
In Colorado, the maximum number of layoffs is in Arts, Entertainment, and Recreation. Los Angeles has not released data yet, but as the home of Hollywood and performing arts, many layoffs will be from this sector.
Entertainment industry representatives self-report that at least a 100,000 workers living paycheck to paycheck are out of work. With the slow progress of state labor departments in tackling the massive numbers of UI claims, these workers are in dire straits.
Museums and auction houses across the US are laying off workers. These institutions had requested the government for aid through the CARES Act. Some institutions like the Indianapolis Contemporary are closing down permanently.
How To Deal With The Present
This sector has faced almost a stoppage in job creation. There are a few job openings at gaming companies and media creation houses like Netflix. But the vast majority of work cannot resume till sports centers, stage shows, entertainment centers, etc. are allowed to open again.
In the meanwhile, those who are unemployed should file for UI benefits immediately. One can also look forward to the direct economic payment from the US government.
There are several voluntary community interventions to help those who find themselves out of work:
- Will Rogers Motion Picture Pioneers Assistance Fund for theatrical exhibition employees
- #PayUpHollywood has raised money through a GoFundMe campaign to support production assistants
- Writers Guild of America has waived COVID-19 testing costs
The situation in the Arts, Entertainment, and Recreation may be quite dire. Even when the country starts working normally again, people will not have the money to spend in these places. The unemployment may go on longer than for other sectors. These venues may also remain closed for longer than other places if the coronavirus spread lasts longer than expected.
Many theatre groups and museums have been struggling financially for years and coronavirus has struck them a death blow. Such ex-employees will need new jobs. Some of the better off cultural centers may be able to survive with just salary freezes. This sector will not create jobs for a long time.
On the bright side entertainment industry workers in California have already started receiving benefits. As the teething troubles get slowly sorted, more people will be able to successfully file UI claims.
Its been a while since unemployment benefits were extended to cover a wider range of unemployed people. So far some states have been quick to keep their labor websites updated with the progress while others are reportedly slow on keeping UI applicants informed. In this article, we shall survey the points of progress the five states with the largest numbers of UI claims are at. You will know when you can expect to hear from your unemployment office if you are worried about the radio silence.
States With The Largest Number Of UI Claims
Over 6 million unemployment insurance claims were filed over last week alone, the record highest number in US history. The states have been overburdened due to a shortage of staff, ill-equipped servers (to handle the volume of claimants logging in) and of course, state trust funds.
As many states had downsized their UI systems over the years, they have been scrambling to hire/depute employees to process the UI claims and sign agreements with the US Dept of Labor to get the CARES Act funds. Let’s take a look at the status of five states with the highest number of UI claims.
This state saw over 900,000 claims filed just last week. While every state on this list is struggling to process the huge surge in UI claims, California is particularly in need of more resources and fast.
Governor Gavin Newsom directed that unemployment phone line timings be extended. So now people can call from 8 am-5 pm whereas previously, calls would not be taken after 12 noon. Unfortunately, the extended hours alone won’t help because many people report being put on hold and not getting hold pf a representative even after the call gets through.
The California Employment Development Department has not yet made guidelines clear for claim filing by independent contractors and gig workers. On the bright side, the state labor website stays up-to-date.
This state has had insured unemployment of more than 500,000 along with over 283,000 UI claims just last week. Pennsylvanians are fortunate to have better UI benefits than many other states even without the additional payout provided by the Families First and CARES Acts.
Pennsylvania claims to have already begun sending unemployment payments. However, the state has not significantly raised the capacity to take calls and respond to email volume, at this time of writing.
The state has tentatively announced that a separate platform to streamline the Pandemic Unemployment Assistance claims will be developed in 2 weeks.
With insured unemployment of 715,750 till March 28 and 345,246 claims filed last week, the state of New York has among the most well-updated sites. The state has been experiencing the same issues with technical capacities and staff shortage but it has kept people informed about the work in progress on different measures being taken.
New York has been quick to upgrade its online UI application system since people reported calls dropping midway when they even got through. The state has roped in new staffers and call centers. They have also extended phone line hours which are now 8 am-7:30 pm.
It has already begun sending out the $600 assistance as part of the Pandemic Unemployment Assistance.
This state saw 388,175 claims filed just this week and a similar number last week. Georgia is ahead of Penn State with an even shorter period of one week announced tentatively for PUA payments to go out.
The Georgia Department of Labor has announced that they are in the process of improving the UI claims process with more questions being added to identify eligible applicants. To help contractors and gig workers they are likely to use different wage criteria from the normal system.
The state has announced that payments will be backdated to ensure that people don’t lose benefit payments due to the delays in executing the program.
A few workers have reported receiving benefits cards but with the money that should have been there, not on them. The phone lines continue to be jammed despite the state hiring call centers.
Michigan is another top state in terms of UI claim filed numbering at 384,844 last week alone. The state has enabled contractors, gig workers, etc. to start filing unemployment claims and extended phone line hours. But the website crashes frequently.
On the bright side, Michigan is among the earliest states to actually start sending the benefits. Most states including Michigan have recommended that applicants file claims as per the following schedule:
Last names beginning with letters A-L: Mondays, Wednesdays, Fridays.
Last names beginning with letters M-Z: Sundays, Tuesdays, or Thursdays.
Whoever misses filing on the above days, can do so on Saturdays.
With states finally gearing up to handle the large payment volumes, people can expect to start receiving benefits by mid-April. There are many teething troubles yet to be fixed such as monetary determination letters showing zero benefits owed due to improper wage calculations. Most states are hiring workers to process additional claims and expanding technical capabilities.
Also heartening to see are funding campaigns and community interventions to support the people laid-off.
The global economic shutdown following the Coronavirus pandemic began with a lot of speculation and fear over the prospective job losses. Three weeks on we have a clearer picture of what is happening and what the future will need in terms of bouncing back from the economic impact. We will take a brief look at how unemployment due to coronavirus is faring and what the likely future holds.
Unemployment Due To Coronavirus At The Moment
The coronavirus pandemic comes after months of job gains and good economic progress. In January alone nonfarm payroll employment rose by 225,000 and similar numbers were seen in February as well.
But now nearly 700,000 jobs previously added, have been wiped out by the global slowdown and precautions being taken in the US. As of now only 41 US states have issued lockdown orders, so more claim numbers can be expected if this situation worsens and all states adopt lockdowns.
Over 16 million unemployment claims were filed in the last 3 weeks, though not all of them are by people who have officially lost a job. The government has relaxed UI rules to accommodate those having reduced or no pay and the self-employed.
The last time in recent history that such huge job losses occurred was from 2008-10, when over 8 million jobs were lost, during the Global Financial Crisis. But this present scenario shows US history’s fastest job losses.
The largest contributors to unemployment vary across states, but the following sectors have seen the biggest losses:
- Accommodation and Food Services
- Arts and Entertainment
Retail Trade has had a mixed response with some establishments doing well due to their supply of essential goods.
Coronavirus Deaths And Unemployment
The COVID-19 was not initially seen as a terrifying disease but that soon changed as the mortality grew, all over the world. Quite a few senators have ended up sick, though those who can afford good healthcare have made a recovery.
This is what’s causing the fears that have spurred global shutdowns. Most people have family and friends who would be susceptible to the disease. New York alone has already seen more than 7000 deaths.
Even without shutdowns, a recession-like situation was bound to happen, as people stay home to avoid spreading the virus. Once certain economic sectors begin to collapse, they take others down due to the interconnected nature of the economy. No job is truly recession-proof.
Lessons from Spanish flu: Disease and Unemployment
Coronavirus is not the world’s first pandemic. The last time a disease spread as wide, was the Spanish flu. It ravaged the world for more than a year from 1918-20 and killed off a quarter of the world’s population, while it was still reeling from World War I.
Although the shutdowns may cause some shocks and pain now, the Spanish flu era shows that cities that made earlier and aggressive preventive interventions had a quicker return rate to normal economic activity. Disease always reduces a population’s productivity, hence striving to maintain it provides a more capable population.
What The Future Entails
Some economists think that the Coronavirus pandemic could go away with tremendous job gains, once the labor market fully revives. They liken it to the 1981-82 recession when the short-term recession caused short term layoffs but workers were later rehired.
Others are not so optimistic. It’s likely that Americans would be afraid of future infections following this pandemic and would start saving, especially if a vaccine is slow to develop. They may not frequent restaurants to the pre-coronavirus extents or shop as much, keeping demand suppressed.
Under such situations, a string of bank loan defaults are likely and may push economic recovery lower. Lenders will not have the confidence to support economic growth.
Wait and watch is the only approach we can take during these hard times. The best option for all of us is to follow the physical and social distancing measures and support the country in fighting this pandemic. Fortunately, the government is taking care of Americans in the short run with stimulus checks and UI benefits. Be sure to file yours if you stop receiving pay.
Retail Trade is a significant sector in the modern economy. It employs a large number of people across various verticals from food to fashion. The market has players as big as Amazon to small neighborhood artisanal stores. You’d expect retail trade to be hit badly by the coronavirus, but there is a mixed record. What is the unemployment in retail trade looking like?
Retail Trading consists of establishments that sell merchandise to retail consumers without themselves altering the products. Even though some retailers are backed by production houses, for the purposes of understanding the sector, that is disregarded for our purposes. Retail Trade also includes non-store retailers like infomercials or catalog retailers.
Overview Of Retail Trade Sector
The Bureau of Labor Statistics informs that the sector employed 16.8 million people in 2018. It showed an unemployment rate of about 7% over the last two quarters.
The top occupations in this sector are Sales Workers, Supervisors, and Cashiers. Salespersons constitute the largest group of employees. Employees may be paid an average of $20 a week and work for an average of 30 hours a week.
Impact Of COVID-19 On Unemployment In Retail Trade
While not the biggest impact, which the food services sector felt, retail trade has also been hit badly except a few players.
Personal Care stores and health stores have closed down, laying off employees as have sporting goods stores and clothing stores. Nordstrom and other clothing retailers have furloughed employees. Fast fashion brands like H&M were already under fire even before the pandemic and the lockdowns have affected them all.
Electronics Retailers including Apple are experiencing a huge demand drop. With so many unemployment claims filed people have no money to spare. Bookstores and hobby/crafting stores are facing the same problem.
Some big retailers like Amazon, Gap, TJ Maxx, and Kohl’s have been slow to close their stores and have been reported to not take adequate precautions to protect workers.
Types Of Jobs Still Available
This is where the mixed news comes in. Supermarkets and grocery stores are doing alright during this period. Sales of food and cleaning supplies are at an all-time high and shops selling them, including pharmacies are open. Many of them are hiring sales workers and shelf stockers.
Although Amazon is famed for its eCommerce, it does have some offline ventures like its Go Stores. Them as well as companies like Whole Foods, Target and Walmart are actually hiring workers to cope with the increased orders.
The retail sector’s death has been predicted many times over the years, but it has held on well. In the short term, clothing and shoe retailers are likely to see the biggest losses until the economy equilibrates.
Though online shopping is rising in popularity, the in-store experience and tangibility offered by offline retail stores are strong. Grocery and food marts will continue to provide a convenient pick-up option over unseen produce that ordering them online brings.
It is likely that players like Walmart and Target will not have as many sales once the economy reopens. This may result in them laying off the many workers they are hiring now.
All this hits back at manufacturing sectors since orders get canceled when there is lowered demand, creating a vicious cycle of people not having enough money to buy from these establishments and further dropping demand. The government is attempting to keep up some spending by providing UI benefits and direct payments.
If you are a retail worker with uncertainty looming over you such as a pay cut or a furlough, then make sure you can file an unemployment claim right away. Some companies may have to provide paid leave so avail that if you or a family member needs to self-isolate.