New unemployment claims bounce back up
Illinois registers major decline, as U.S. filings remain above pre-COVID record
New U.S. claims for unemployment insurance remain stubbornly above the pre-COVID record, although Illinois claims declined last week. (Shutterstock)
By Ted Cox
Newly filed claims for unemployment defied economists’ expectations to bounce back up in weekly figures released Thursday, even as Illinois saw its unemployment rate drop below the national figure.
The U.S. Department of Labor released its weekly unemployment report, finding that another 742,000 newly idled workers filed for benefits nationwide last week. After the department announced two weeks running earlier this month that 751,000 new claims for unemployment insurance had been filed, last week it reported an encouraging drop to 709,000. But this week that figure was revised up to 711,000, and hopes that the figure could drop to 700,000 or below were dashed with the new increase, blamed on states reimposing restrictions on bars, restaurants, and retail outlets as COVID-19 cases spike across the nation.
The pre-COVID record of 695,000 claims filed in a week was set during the 1982 recession. But new claims have not fallen to that level since 3.3 million workers idled by the pandemic filed for benefits in mid-March, soon topped by the new record of 6.9 million in a week. It was the first time in over a month that new claims increased week to week.
Illinois, however, actually registered a steep decline in advance unemployment claims of more than 20,000 in a week, to 47,000 from 67,000 the week before. Gov. Pritzker said last week that the state was seeing a new surge in suspect claims for jobless benefits, and that it was working to rein in the fraudulent filings.
Later Thursday, the Illinois Department of Employment Security reported that the state unemployment rate for October plummeted to 6.8 percent, dropping below the national rate of 6.9 percent for the month. That was down 3.6 percentage points after the September state unemployment rate was revised up to 10.4 percent. That also justified Pritzker, who recently said the state rate would drop, as Illinois typically lags behind the trend shown by the national figure.
“While we continue to see positive signs that employment is picking back up, we know that there is much more work ahead as we strive for a full recovery from the impact of COVID-19 on our Illinois workers and Illinois businesses,” said Erin Guthrie, director of the Department of Commerce and Economic Opportunity. “Under the leadership of Gov. Pritzker, Illinois has not only led with a swift and decisive public health response to the virus, but we've also introduced more than $1 billion in economic support programs at DCEO alone to help small businesses and communities weather the storm. Our continued vigilance on public health measures is necessary to restore our economy and bring more people back to work.”
Previously, mass fraud struck the Pandemic Unemployment Assistance program providing expanded federal benefits to independent contractors, freelancers, and so-called gig workers not typically covered under conventional unemployment insurance. But the state succeeded in stemming that onslaught. Last week, new claims for PUA benefits rose just above 10,000 in Illinois, after 9,700 filed the week before.
The Pritzker administration warned, however, that the coronavirus crisis wasn’t over, not with COVID-19 cases rising in the state and across the country, and not with nonfarm payrolls still down more than 400,000 jobs from a year ago. “While the unemployment rate has steadily declined over the last several months, the Governor’s Office and IDES are working tirelessly to assist claimants while confronting the challenges created by the COVID-19 pandemic,” said Deputy Governor Dan Hynes. “IDES is taking necessary steps to make claimants aware of the impending expiration to the federal CARES Act programs, set to end the week ending Dec. 26. The department is working closely with the Pritzker administration to advocate for claimant stability at the federal level and will continue to do so throughout this pandemic.”
Economists had expected another decline in claims for benefits across the nation with the ramping up of holiday hiring. But the nationwide surge of the coronavirus has prompted governors to reimpose restrictions on restaurants, bars, and retail outlets, cutting into what is typically a rise in seasonal employment.
The Labor Department reported that 20.3 million idled U.S. workers were receiving some sort of unemployment insurance, down 840,000 from the previous week, but still many times the 1.5 million who were drawing on unemployment at the same time last year.