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Week 10 of the U.S. Labor Market Collapse: Still Getting Worse at Gut-Wrenching Pace, But Signs of Bottom Appear

Summary:
Gig workers weigh. PUA and “Initial Claims” surge. But millions of other workers got their jobs back. Here are the “Insured Unemployment Rates” for each state, topping out at 30%. By Wolf Richter for WOLF STREET. Has the collapse of the US labor market finally bottomed out? It would have to stop getting worse first. After it stops getting worse, it might begin to recover. And there are signs that the labor market might be approaching that bottom, but the overall numbers are still getting a lot worse. The number of people who filed for unemployment insurance in or before the week ended May 9 under all state and federal unemployment insurance programs combined, including Pandemic Unemployment Assistance (PUA) for gig workers and programs for laid-off federal employees, and who still

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Gig workers weigh. PUA and “Initial Claims” surge. But millions of other workers got their jobs back. Here are the “Insured Unemployment Rates” for each state, topping out at 30%.

By Wolf Richter for WOLF STREET.

Has the collapse of the US labor market finally bottomed out? It would have to stop getting worse first. After it stops getting worse, it might begin to recover. And there are signs that the labor market might be approaching that bottom, but the overall numbers are still getting a lot worse.

The number of people who filed for unemployment insurance in or before the week ended May 9 under all state and federal unemployment insurance programs combined, including Pandemic Unemployment Assistance (PUA) for gig workers and programs for laid-off federal employees, and who still don’t have a job, surged by 3.68 million people in the week (not seasonally adjusted), the US Department of Labor reported this morning. They’ve now reached a gut-wrenching record of 30.96 million:

Week 10 of the U.S. Labor Market Collapse: Still Getting Worse at Gut-Wrenching Pace, But Signs of Bottom Appear

Gig workers weigh heavily.

The number of initial claims by gig workers who are now eligible to file under the federal unemployment insurance program Pandemic Unemployment Assistance (PUA), and who are not eligible to file under state programs, jumped by 1.19 million (not seasonally adjusted) in the week ended May 23.

The number of gig workers who’d initially filed PUA claims through the week ended May 9 and who are still not working, has now surged to 7.8 million (not seasonally adjusted).

There are still well over a dozen states – including the big one, Florida – that have not yet started processing PUA claims. And when they finally figure out how to do it, those claims will add large lumps to the total, and we can expect to see large catch-up numbers in the future, reflecting gig workers who’ve lost their gigs in late March or April.

New claims under state programs surge at gut-wrenching pace.

In the week ended May 23, about 1.91 million workers filed initial unemployment claims under state programs (not seasonally adjusted). This means the layoffs are still proceeding at a previously unimaginable pace, at three times the magnitude of the prior weekly records during the unemployment crises in 1982 and 2009:

Week 10 of the U.S. Labor Market Collapse: Still Getting Worse at Gut-Wrenching Pace, But Signs of Bottom Appear

But millions of previously laid-off people got hired back.

And this is where the first signs of a bottom in the collapse of the labor market come into view. The number of “insured unemployed” – the people who’d filed for state unemployment insurance in or before the week ended May 16 and still haven’t found a job – dropped by 3.74 million to 19.05 million “continued claims” (not seasonally adjusted). This means that millions of people who’d received state unemployment insurance have been hired back:

Week 10 of the U.S. Labor Market Collapse: Still Getting Worse at Gut-Wrenching Pace, But Signs of Bottom Appear

The 28 states with the most “initial claims.”

These are the initial claims filed in the week ended May 23 under state programs and do not include claims under federal programs, such as PUA claims:

Top 28 States, Initial Claims in the week ended May 23
1 California 212,343
2 New York 192,193
3 Florida 173,731
4 Georgia 164,350
5 Texas 128,105
6 Pennsylvania 69,408
7 Virginia 58,591
8 Illinois 58,359
9 Michigan 57,714
10 Kentucky 53,738
11 Washington 53,280
12 North Carolina 43,221
13 Ohio 42,363
14 Massachusetts 37,740
15 New Jersey 33,290
16 Maryland 33,240
17 Oklahoma 32,127
18 Minnesota 28,615
19 Wisconsin 28,308
20 Oregon 27,514
21 Alabama 27,289
22 Arizona 26,878
23 Indiana 26,278
24 Tennessee 26,041
25 Missouri 25,917
26 South Carolina 24,950
27 Mississippi 24,348
28 Louisiana 23,853

The “Insured Unemployment Rate” per state

The “insured unemployment rate” across the US for the week ended May 16, also released today, declined to 13.1% (not seasonally adjusted), from 15.6% in the prior week. This is still far above the record in the pre-Covid-19 era of 7.9% (not seasonally adjusted) in May 1975. But the fact that it declined – this will have to be confirmed because this week-to-week number is volatile and might jump next week – may be another sign that the bottom is coming into view.

The “insured unemployment rate” for each state lags one week behind the national average. And they’re very different from the Bureau of Labor Statistics’ monthly unemployment rates for each state, which are based on household surveys. These rates here are based on unemployment insurance claims, on a weekly basis. And given the hurly-burly nature of the huge surge in unemployment claims in past weeks and the chaos that came with them, these rates have moved sharply from week to week, in either direction. So enjoy with some circumspection.

There are 37 states plus Washington DC with a double-digit “insured unemployment rate”; in six states, the rate is above 20%, with Florida at 25%, Nevada at 26.7%, and Washington at 31% (as I said, these rates move sharply in either direction, given the nature of tracking the chaotic collapse in the labor market on a week-by-week basis).

Insured Unemployment Rate by state, week ended May 9
1 Washington 31.2%
2 Nevada 26.7%
3 Florida 25.0%
4 Hawaii 23.4%
5 Michigan 23.1%
6 California 20.6%
7 New York 19.9%
8 Rhode Island 18.8%
9 Vermont 18.2%
10 Connecticut 18.0%
11 Georgia 18.0%
12 New Hampshire 17.6%
13 Pennsylvania 17.4%
14 Louisiana 17.3%
15 Mississippi 17.1%
16 Massachusetts 16.5%
17 Alaska 16.2%
18 Maine 15.3%
19 Oregon 15.2%
20 Minnesota 14.9%
21 New Jersey 14.9%
22 West Virginia 14.8%
23 North Carolina 13.8%
24 Ohio 13.2%
25 Kentucky 13.0%
26 New Mexico 12.9%
27 Illinois 12.4%
28 South Carolina 12.3%
29 Iowa 12.1%
30 District of Columbia 11.9%
31 Montana 11.8%
32 Delaware 11.4%
33 Virginia 10.8%
34 Wisconsin 10.8%
35 Alabama 10.6%
36 Texas 10.6%
37 Arkansas 10.2%
38 Tennessee 10.1%
39 Maryland 9.9%
40 Missouri 9.4%
41 Colorado 9.2%
42 Indiana 8.9%
43 Oklahoma 8.6%
44 Idaho 8.2%
45 Arizona 8.0%
46 Kansas 8.0%
47 North Dakota 7.8%
48 Nebraska 6.5%
49 Wyoming 6.4%
50 South Dakota 6.0%
51 Utah 5.9%

Holy cow, Los Angeles. The California economy is gradually opening up. But the exodus has started hard and heavy. And the influx has stopped. Read…  Catastrophic Plunge in Jobs & Labor Force in Los Angeles, San Francisco/Silicon Valley Smacks into Housing Bubbles

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Week 10 of the U.S. Labor Market Collapse: Still Getting Worse at Gut-Wrenching Pace, But Signs of Bottom Appear

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Wolf Richter
Founder, Wolf Street Corp. In his cynical, tongue-in-cheek manner, he muses on WOLF STREET about economic, business, and financial issues, Wall Street shenanigans, complex entanglements, and other things, debacles, and opportunities that catch his eye in the US, Europe, Japan, and occasionally China.

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