Unemployment: Behind the numbers

The unemployment rate and industry breakdowns undercount joblessness for several reasons. They are a snapshot in time from the week of April 12. Since then, millions more people have become unemployed. The 5,100 households surveyed for the unemployment figure are asked if they are looking for work. Those who say no are not counted as part of the California workforce — the denominator for the unemployment rate. But many people currently can’t seek work, because they are caring for children since schools are closed, are in vulnerable populations who must stay home, or other pandemic-related reasons. At the same time, the state dropped a requirement for those who receive unemployment benefits to be actively job-hunting. All that artificially depressed the workforce number. The result: California’s official workforce number dropped by 599,800 in the month to 18.7 million. It was already down by 251,800 in March compared to February. In other words, about 850,000 people were not counted as part of the labor force. Since 5,100 is a small sample size, analysts use unemployment claims filings and other data to make the monthly estimates more statistically robust, the EDD said. The industry breakdowns, which are based on surveys of 80,000 California businesses, exclude self-employed, freelance and gig workers. But huge numbers of them are out of work. The new Pandemic Unemployment Assistance provides benefits for this group. California has received 686,798 claims for PUA since it started accepting them on April 28.