| Business: California still missing from U. S. jobless numbers
U. S. numbers rise 840,000; state figures cloudy
In a weekly ritual that’s become numbingly familiar during the pandemic, the government said 840,000 additional Americans filed for unemployment last week — a number that would have been unimaginably high in February and now is the new normal.
That brings the total number of new unemployment claims to 63.6 million since mid March.
In addition, 464,437 people filed for Pandemic Unemployment Assistance, a new program created for selfemployed people.
“We’re still in a pretty concerning state,” said Audrey Guo, an assistant professor of economics at Santa Clara University. “I don’t think economic recovery is a sure thing.”
California reported only minimal new jobless claims for the week ended Oct. 3 because the state was finishing up a two week pause to revamp its troubled benefits application system.
For the second week in a row, the national report from the U.S. Department of Labor used California’ s new claims number of 226,179 from the week before its pause to avoid showing significant swings that are “unrelated to any changes in economic conditions,” the department said in a news release. Future reports will be revised to reflect claims for the period.
California formally resumed taking unemployment applications on Monday with a new system called ID. me to verify claimants’ identities that it said should speed
up processing. The state invited some applicants to test the system as early as Oct. 1.
California is chipping away at a gargantuan backlog of 1.6 million unresolved claims. While it’s now processed 246,000 of them, it will take until January to finish, Sharon Hilliard, executive director of the Employment Development Department, told lawmakers who expressed frustration at a hearing on Wednesday.
On Thursday, the EDD said it has processed 14.7 million claims — both regular and pandemic — since March and paid more than $ 98 billion in benefits.
Nationwide, some 25.5 million people were collecting all forms of unemployment for the week ended Sept. 19.
“There is still a very long way to go, and it doesn’t look like we’re going to get the stimulus to help us get there,” said Chad Stone, chief economist at the Center on Budget and Policy Priorities, a nonpartisan research and policy institute. “We are way below where we were ( before the pandemic) — much less than where we need to be.”
President Trump has scotched the idea of broadbased pandemic relief that would include help for state governments, which now may have to slash payrolls. California has already cut billions of dollars, largely through layoffs, and had hoped to reverse them if a federal bailout arrived by the middle of this month.
Trump tweeted this week that relief would wait until he wins the election in November. Observers said that presumably if he loses, he would not move forward on any stimulus packages during the remainder of his term, meaning it would be next year before the federal government acted. Trump’s position has flipflopped in a series of tweets, however, and he recently proposed a new round of $ 1,200 stimulus checks for individuals.
The supplement to unemployment benefits of $ 600 a week through late July and a separate program that provided $ 300 a week for a few weeks is now over — and its loss will have huge repercussions for lowerwage workers, who used the money for food, rent or other necessities, thus putting it back into circulation.
“That ( supplement) was important in the second quarter to sustain the economy despite market contractions and layoffs,” Stone said. “For lowincome workers, it helped keep things from being even worse.”
Longterm unemployment — defined as people out of work for six months — is worrisome. The September unemployment report released last week showed it increasing to 2.4 million people, up from 1.6 million in August — and almost double a year earlier.
“It’s hard to see where they’re going to be able to find jobs again,” Guo said. “A lot of small businesses have closed; those jobs are gone.”
Hardhit industries like retail, hospitality and travel that are not bouncing back could leave a lot of workers “with big issues about where else they will be qualified to apply for jobs,” she said. Stone had similar thoughts. “It will be harder for those people to get back to work even as the economy strengthens,” he said. “We found in the ( 200709) recession that you become stigmatized if you were longterm unemployed; employers would discriminate against” those people.
Some people are returning to work, but even as that happens, more are being laid off as the repercussions continue to ripple through industries and companies.
After almost four months of being laid off, Zack Sutter got rehired in July to his former position of senior recruiter by his employer, San Francisco’s Turo, which helps people rent out their personal cars to others.
But the very day that he went back to work, his thenfiancee, now wife, Ariel Sutter, was laid off from her job as a human resources manager at a highend restaurant group, after spending several months laying off colleagues.
“She was losing all her benefits, so was able to jump on mine,” he said. “We were lucky.”
As a recruiter, Sutter knew he’d likely be in the crosshairs as soon as the pandemic started to affect Turo.
“When a company stops hiring, there’s always a target on your back because you’re an expensive asset that’s not being used,” he said.
But he appreciated that Turo provided severance and the board lengthened the time frame for exercising stock options. Now that he’s returned, he’s both rehiring former colleagues and reaching out to see if any need help finding other opportunities.
Turo CEO Andre Haddad said the business recovered “quite strongly” after an initial hit. While business in the second quarter fell 25% compared to the prior year, he said, that was still better than the ridehailing companies, which were down by twothirds or more; and traditional carrental companies, which were down 80%. The third quarter has seen healthy growth, he said.
Turo laid off 92 people, or a quarter of the staff, in late March. It’s now hired back 50 people.
“Many customers decided to get a Turo instead of public transit or ( ridehailing) because a private car without anyone else driving it felt safer,” Haddad said. “We think we’re benefiting from pentup demand for travel.”
The Sutters had the extra stress of planning a wedding while one or the other of them was unemployed over the past six months. They downsized their guest list from 165 to just immediate family and married in September on a farm in Nevada City, near where Zack Sutter’s great great great grandfather, John S utter, discovered gold in 1848, kicking off the California Gold Rush.
Their honeymoon likewise was scaled back. Underscoring Haddad’s point about travelers hitting the road, they replaced a planned tour of Italy, Greece and Spain with a Western states road trip to Santa Barbara, Palm Springs, Joshua Tree, the Grand Canyon, Bryce Canyon, Las Vegas and Lake Tahoe.