Claims fall, but rate still high

California has 11% of the nation’s labor force but 18% of new applications for unemployment

With coronavirus cases surging after Thanksgiving and California under lockdown, the state’s rate of new claims for unemployment assistance remains significantly higher than the nation’s, new government data show, and experts say the outlook for jobs is grim.

According to the U. S. Department of Labor, 156,357 newly unemployed Californians made claims for assistance last week, down from 204,388 the prior week, a 23% drop. Nationwide, new claims fell about 8%.

However, California has about a tenth of the nation’s civilian labor force but nearly a fifth of the new claims, and the state may be nearing bottom in the number of jobs it can lose, said Michael Bernick, a former director of the state Employment Development Department and an employment lawyer at Duane Morris. “You’ve got to wonder who else is out there to lay off,” Bernick said.

And even with possible help on the horizon from a federal COVID-relief bill, the dramatically worsening viral outbreak and associated lockdowns mean most people who have lost their jobs in the Bay Area won’t be rehired for quite some time, said Stephen Levy, senior economist at the Center for Continuing Study of the Califor

nia Economy in Palo Alto.

“The virus is surging and we haven’t even gotten to Christmas yet,” Levy said. “The people who work in hotels and restaurants and shopping centers aren’t going back to work anytime soon because the pandemic is not under control. The vaccine won’t help for a long time. I think we’re going to be in for restrictions for three months, at least.”

A “sharp class divide” means part of the region’s workforce is getting hammered by unemployment and another is not, Bernick said. Remote workers in steady-paying jobs, including government employees and workers in large firms such as tech companies “have been largely immune from the economic impacts,” with small business owners and employees, independent contractors and hourly workers suffering the brunt of job losses, Bernick said.

California has seen higher per- capita claims than other states since the start of the pandemic, and especially over the past two months, Bernick said. The state’s weekly unemployment claims have remained high during the pandemic, but have declined since hitting more than 1 million at the end of March.

Across the U. S., there were 869,398 new unemployment claims, according to the Labor Department’s data table, which is updated weekly. California’s unemployment rate was 8.2% in November, more than double the rate a year ago, according to the Employment Development Department.

Even if the national stimulus plan, which would provide a one time payment of $600 and a $300-per-week unemployment supplement along with extending the time people can receive payments, survives opposition from President Donald Trump, it’s unlikely to bring jobs back in the short term because of lockdowns and the surge in coronavirus cases, Bernick said.

Adding to the woes of out- of-work Californians is the Employment Development Department’s growing backlog of unemployment claims that state government officials have failed to pay, with an estimated 683,200 California workers waiting for money as of Dec. 16. Federal unemployment relief goes through the EDD, Levy noted.

“Even if the COVID-relief bill finally passes and there is some more money,” he said, “that doesn’t get it into the hands of workers until the EDD system is caught up.”