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Last week, 2.3 million workers applied for unemployment benefits. This is now the 18th week in a row that unemployment insurance (UI) claims have been more than twice the *worst* week of the Great Recession. 1/ https://www.dol.gov/ui/data.pdf
Many headlines say there were 1.4 million UI claims last week. THAT IS WRONG—it ignores PUA, the federal program for workers who are not eligible for regular UI, like gig workers. It also uses seasonally adjusted data for regular state UI, which is problematic right now. 2/
Of the 2.3 million workers who applied for unemployment benefits last week, 1.37 million applied for regular state UI (not seasonally adjusted), and 975,000 applied for Pandemic Unemployment Assistance (PUA). 3/
The across-the-board $600 increase in weekly unemployment benefits is set to expire *at the end of this week.* That is not just cruel, it’s terrible economics. 4/
These benefits are supporting a huge amount of spending by people who would otherwise have to make drastic cuts (see chart). That spending is supporting more than 5 million jobs. Kill the $600, and you kill those jobs. 5/ https://institute.jpmorganchase.com/institute/research/labor-markets/unemployment-insurance-covid19-pandemic
This map shows many jobs will be lost in *your* state if the extra $600 unemployment benefit is allowed to expire. 6/ https://www.epi.org/chart/puc-cutoff-figure-if-the-600-weekly-unemployment-insurance-increase-is-allowed-to-expire-how-many-jobs-will-it-cost-over-the-next-year/
The work disincentive of the $600 has been massively overblown. In May and June—with the $600 in place—7.5 MILLION people went back to work. (And, about 70% of likely UI recipients who returned to work were making more on UI than their prior wage.) 7/ https://twitter.com/ernietedeschi/status/1285567925596889090?s=20
Concerns about the work disincentive ignore the realities of the labor market for working people, who will be very unlikely to turn down a job for a temporary boost in benefits —particularly when it is now clear that jobs are going to be very scarce for a very long time. 8/
Further, there are 14 million more unemployed workers than job openings, meaning millions will remain jobless no matter what they do. Honestly folks, cutting off the $600 cannot incentivize people to get jobs that AREN’T THERE. 9/ https://files.epi.org/charts/img/196746-25298.png
Even further, many people simply can’t go to work right now because it’s not safe for them or their family, or because they have care responsibilities as a result of the virus. Cutting off the $600 cannot/will not incentivize them to get jobs, it will just cause pain. 10/
If policymakers insist on ignoring the evidence and worrying about the work disincentive effect of the $600, they should address their concern by letting people keep some of their UI when they go back to work—not by cutting off the $600, which is keeping the economy afloat. 11/
Cutting off the $600 will also exacerbate racial inequality. Due to the impact of historic & current systemic racism, Black and brown communities are suffering more from this pandemic, and have less wealth to fall back on. They will take a much bigger hit if the $600 expires. 12/
This is particularly true for Black and brown women and their families, because in this recession, these women have seen the largest job losses of all. 13/
And Congress needs to act immediately. If they let the extra payments expire and then reinstate them, it will be a needless administrative nightmare for state agencies, and recipients—who will face a lapse in benefits of several weeks in most states—will pay the price. 14/
DOL numbers suggest that right now, 34.3 million workers are either on unemployment benefits, have been approved and are waiting for benefits, or have applied recently and are waiting to get approved. 15/
CAUTION: The above chart is an *upper bound* on the number of people “on” UI and receiving the $600, for three reasons (unfortunately we only know the magnitude of the first one): 16/
First: It includes initial claims, which represent people who have not yet made it through the first round of processing so are not getting the $600. 17/
Second: Some individuals may be being counted twice. Regular state UI and PUA claims *should* be non-overlapping—that is how DOL has directed state agencies to report them—but some states may be misreporting. 18/
Third: Some states are likely including some back weeks in their continuing PUA claims, which would also lead to double counting. See discussion around Figure 3 in this great paper. 19/ https://www.federalreserve.gov/econres/feds/files/2020055pap.pdf
This chart shows continuing claims in all programs over time (the latest data to do this are for July 4). Continuing claims are more than 30 million above where they were a year ago. (The above caveat about continuing PUA claims applies here too.) 20/
I don't know what happened to the picture in tweet 5 above, but here's a non-fuzzy version, sorry about that!
And as always, here's this tweet thread in blog post form, if helpful. https://www.epi.org/blog/joblessness-remains-at-historic-levels-and-there-is-no-evidence-ui-is-disincentivizing-work-congress-must-extend-the-extra-600-in-ui-benefits/
