CHATTANOOGA Jobless rate drops but employment is still down

Unemployment in metro Chattanooga fell last month to its lowest level since before the coronavirus shut down of the economy in March and stayed below both the state and national averages during July.

But five months into the pandemic, there are more than 18,000 fewer jobs in the six-county Chattanooga metro area than a year ago and new jobless claims from recently laid off workers continue at elevated levels even as jobless benefits have been severely cut this month.

“We’ve seen many businesses come back from earlier this spring, but a full recovery may take years,” University of Tennessee Economist Bill Fox said.

The Tennessee Department of Labor and Workforce Development said Thursday that the jobless rate in the Chattanooga area fell during July to 7.9%, or nearly 30% below the comparable non-seasonally adjusted U.S. jobless rate of 11.2% last month. The jobless rate in metro Chattanooga has nearly fallen in half from the 13.3% peak reached in April. But the July unemployment rate this year was still more than twice the level of a year ago and Tennessee recorded another 10,998 new filings last week from those recently losing their jobs.

Nationwide, the U.S. Department of Labor said Thursday that just over 1 million Americans applied for unemployment benefits last week.

“Layoffs are ongoing reflecting interruptions to activity from virus containment that are likely resulting in permanent closures and job losses,” Rubeela Farooqi, chief U.S. economist at High Frequency Economics, wrote in a research report.

Those being laid off or still without work are getting far less in weekly jobless benefits this month than they did in the months leading up to the end of July with supplemental federal jobless benefits ran out.

Congress is debating whether to renew the $600 weekly federal supplement, but in the meantime President Trump is using $44 million of Federal Emergency Management Agency funds to provide federal payments of $300 a week under the Lost Wages Assistance program for several more weeks.

Tennessee got approval for the FEMA supplemental payments last week but it is still working to pay out the money.

Last week, Tennessee paid an average of $299.58 in weekly benefits to 241,295 claimants. That’s less than half of what unemployed persons were getting in benefits just a few weeks earlier.

All of the $72.3 million paid in jobless benefits in Tennessee last week was from federal coronavirus relief money as Tennessee continues to try to protect the solvency of its employer-paid unemployment insurance fund.

This past week, the Georgia Department of Labor started creating a system to implement the Lost Wages Assistance program, that will distribute an additional $300 supplement to eligible individuals receiving benefits from Georgia’s state and federal unemployment insurance programs.

“We are working as quickly as possible to build an application to meet the new FEMA guidelines to process these weekly supplements,” Georgia Labor Commissioner Mark Butler said Thursday.

In Georgia, initial claims totaled 56,768 last week, down 1,331 from the prior week. The agency issued $211 million in regular unemployment benefits and federal funds for Pandemic Emergency Unemployment Compensation payments.

Altogether, the Labor Department said that 27 million people are receiving some form of unemployment benefits, though the figure may be inflated by double-counting by states.