Unemployment Still at Historic Levels, But Slowing Down
Latest jobs report shows country at 13.3% unemployment, might actually be 16%.
The United States has now seen 12 straight weeks of unprecedented unemployment claims, and an unemployment rate that is holding at a level above the worst weeks of the Great Recession.
Last week, 1.5 million people filed unemployment claims in the United States. The total number of claims filed since the beginning of March is now 44.7 million, which is equivalent to approximately 27 percent of the country’s labor force.
Wisconsin has seen 24,492 new claims. That brings the total of unemployment claims filed in the state since March 15th to 654,346.
But the latest jobs report released by the Bureau of Labor Statistics (BLS), issued Friday, June 5th, showed that 2.5 million jobs had been added to the economy since its April report. The new unemployment rate BLS calculated for the country is approximately 13.3 percent.
As it did in April, the BLS misclassified a number of workers that are absent from work as employed when they should have been classified as unemployed. Had they been correctly classified, the unemployment rate would have been 3 percentage points higher, or approximately 16 percent. In the report the bureau wrote, “BLS and the Census Bureau are investigating why this misclassification error continues to occur and are taking additional steps to address the issue.”
Dozens of states across the country have begun lifting or rolling back their Stay-At-Home orders, which were a response to COVID-19. Wisconsin’s was tossed out in early May by the Wisconsin Supreme Court and much of the state re-opened in the days that followed.
This resumption of economic activity is likely leading to both the creation of new jobs and the slowdown in unemployment claims in recent weeks. However, despite that slowdown, claims continue to come in at a rate that was previously unprecedented.
Heidi Schierholz, former Chief Economist for the U.S. Department of Labor, wrote this: “How is it that we are seeing large numbers of initial unemployment claims now, when the jobs report from last Friday shows we added jobs in May? One key thing is the fact that the unemployment benefits numbers don’t account for changes in hiring. If there are a large number of layoffs, there can still be job growth if there is also a lot of hiring (or rehiring). Further, some unemployment claims since April may be from people who actually lost their job in March or April but didn’t apply right away (perhaps because they couldn’t get through the system).”
While the rate of new unemployment claims slows down, and the latest jobs report shows a slightly better labor market than the previous report, the current unemployment rate is still more than three percentage points higher than what the country experienced in the worst weeks of the Great Recession.
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