Arizona Jobless rate hits 12.6% in April

PHOENIX – Arizona’s jobless rate spiked last month to 12.6%, a figure that may be a record.

And it’s certain to go higher as the figures reflect the number of people out looking for work in the second week of April. Since that time, there have been another 230,000 first-time claims for unemployment insurance.

Yuma County’s rate jumped to 23.1% in April, up from 16.7% in March.

Whether the state’s 12.6% rate is a record is unclear.

Doug Walls, the market research director of the state Office of Economic Opportunity, said that comparable data goes back only to the beginning of 1976. And in all that time the highest unemployment rate recorded was 11.5% during the 1982 recession.

Walls said the rate did hit 13% in 1956. But he cautioned that the methodology used at that time was different than it is now.

The news comes as Republican legislators on Thursday quashed efforts by Democrats to increase the benefits available to the more than 577,000 people who have applied for unemployment insurance since the COVID-19 pandemic and the orders by Gov. Doug Ducey shutting down many businesses. GOP lawmakers also blocked a vote on a proposal to allow people to get unemployment payments if they leave their jobs due to unsafe working conditions.

What’s behind the sharp increase in unemployment last month is that the private sector shed 276,300 jobs from the prior month. By contrast, the state normally adds 7,800 workers in April.

The biggest loss, not surprisingly, is in the leisure and hospitality industry. That includes the bars and restaurants that Ducey in late March ordered shuttered except for take-out.

It also includes hotels, motels and resorts which, while not closed down, have suffered both from the governor’s stay-at-home order as well as the unwillingness of people to travel, particularly by air. That is reflected in data from the Joint Legislative Budget Committee which found tax revenues from these businesses had dropped 57.5% from March.

Finally, the category also

includes movie theaters, amusement parks and sporting events, also shut down by Ducey’s orders.

Other sectors of the Arizona economy also have been hard hit.

Retail trade shed 43,800 jobs – about 13.4% of total employment – as shops also were affected by the governor’s directive allowing only “essential’’ businesses to operate. There also was the loss of 27,800 jobs in professional and business services.

Even the state’s health care industry shed 16,800 jobs, something Walls said is likely due to Ducey barring hospitals from performing elective surgeries and procedures.

Still, for the first time in years, the situation actually is better than the rest of the county, with the United States posting a seasonally adjusted unemployment rate of 14.7%.

Walls said this is due to the fact that the employment losses in the state’s construction and manufacturing industries were minimal. He said that is because Ducey’s directives did not shut down those sectors of the economy while governors in other states had far broader orders.

Rep. Kelli Butler, DParadise Valley made the proposals dealing with changes to unemployment insurance as amendments to bills being considered Thursday by the House Committee on Health and Human Services.

Republicans balked, noting that the amendments would have killed the underlying provisions of the Senate-passed bills because they were unrelated to the original subjects.

Butler acknowledged the importance of those bills. But she argued there are more pressing issues, like worker safety.

One proposal would create an exception to Arizona law which generally says that people who quit work voluntarily are ineligible for benefits. It would permit people to collect if an employer “failed to cure a working condition that made the work environment unsuitable for health or safety reasons.’’

“What is more important is addressing the public’s concern about their health and well being, and their ability to go to work and be safe,’’ Butler said.

But she was outmaneuvered in turn by the Republicans who used procedural motions to prevent the amendment from even being offered.

Butler had no better luck with a proposal to increase the maximum benefit.

Arizona law says people who are fired or laid off due to no fault of their own are entitled to half of what they were making. Payments come from an account funded by a tax employers pay on the first $7,000 of each worker’s salary.

But the law caps benefits at $240 a week, a figure not adjusted since 2004. Only Mississippi pays less.

Her proposal would have

set the maximum at $490.

By comparison, the cap is $450 in California, $492 in New Mexico, $560 in Utah and $597 in Colorado.

Rep. John Allen, R-Scottsdale, who led the successful effort to block consideration of the Democrat amendments, accused the Democrats of “grandstanding.’’

“All it is is political posturing,’’ he said. “It’s tears for votes.’’

Butler said her efforts to amend the bills would not have been necessary had the Democrats been able to get the Republican majority to hear the issues through the regular process. And she said that the problems they address have only become more important as hundreds of thousands of Arizonans have lost their jobs.

“It’s not theatrics,’’ Butler said, citing the high jobless rate and the problems that the Department of Economic Security has had handling the crush of applications for benefits.