With just four weeks to go before millions of Americans lose their weekly unemployment insurance checks as programs expire and people laid off at the beginning of the coronavirus pandemic who still aren’t working exhaust their allowable benefits, the Department of Labor reported Thursday that another million of them had filed applications for initial benefits in the week ending Saturday, Nov. 28. That makes 37 weeks in a row that more than a million people have filed.
But while it’s obvious the economic situation remains dire as Americans in towns and cities across the nation queue up in overwhelming numbers at food banks and at least 4 million jobs have gone away permanently, the Government Accountability Office reported earlier this week that the DOL’s count of how many people are receiving unemployment benefits isn’t accurate because the unprecedented deluge of applications created backlogs and double-counting due to repeat applications over time by the same individuals. The former has created tallies that are too low and the latter tallies that are too high. The GAO doesn’t know how far off the numbers may be.
The GAO reported:
The CARES Act created three federally funded temporary programs for unemployment insurance (UI) that expanded benefit eligibility and enhanced benefits. In its weekly news releases, the Department of Labor (DOL) publishes the number of weeks of unemployment benefits claimed by individuals in each state during the period and reports the total count as the number of people claiming benefits nationwide. DOL officials told GAO that they have traditionally used this number as a proxy for the number of individuals claiming benefits because they were closely related. However, the number of claims has not been an accurate estimate of the number of individuals claiming benefits during the pandemic because of backlogs in processing a historic volume of claims, among other data issues.
While this past summer’s rebound from the 22.2 million jobs lost in March and April started strong, job growth has since slowed considerably. The first dose of austerity was the expiration of the enhanced UI benefit in July—specifically, the PUC program that provided an extra $600 per week in benefits. Although the economy grew strongly in the third quarter based on momentum from businesses reopening and strong income support from the CARES programs, these PUC cuts will continue to take a serious toll on job creation going forward. As of October, the U.S. economy is still down 10 million jobs from where it was in February. If job growth continues to slow or even reverse course in the winter months as COVID-19 caseloads rise, states reshutter large swaths of businesses, and federal policymakers provide no additional aid to unemployed workers or state and local governments, it will be years before we return to anything resembling the pre-pandemic economy. It would be a tragedy to force U.S. workers to yet again wait a full decade between brief periods of tight labor markets that drive acceptable wage growth. […]Having more generous and longer-lasting UI benefits turn off in the midst of a recovery that is still 10 million jobs short of pre-recession levels illustrates why these benefits should be dictated by economic conditions, not by the whims of Congress. Implementing effective automatic stabilizers—both in UI and for programs like federal fiscal aid to state and local governments—should be a pressing priority for the incoming administration.