Public Assets Institute After six months of slowly returning, hotel and restaurant jobs dropped off again in November, as increasing COVID-19 cases limited travel and socializing. And this mid-month count probably does not capture the effects of new restrictions that began on November 14. Vermont hotels and restaurants had 40 percent fewer jobs last month than in November 2019. Private-sector jobs overall were down 10 percent year over year.
Unemployment claims
As COVID cases rise, so does the number of newly unemployed Vermonters. Since the most recent round of business restrictions, more than 6,200 people filed new unemployment claims. While claims often rise in the fall, these recent applications were nearly twice the number as at the same time last year. Meanwhile, Washington will determine the fate of 20,000 Vermonters already receiving unemployment. Federal pandemic benefits are set to expire next week, yet Congress has failed to act.
Remote work
As many as 150,000 Vermonters may have been able to work from home during the COVID-19 pandemic, according to newly released data from the Bureau of Labor Statistics. Sixty percent of private-sector employees worked at businesses that increased telework options since the start of 2020—the second-highest rate in New England and fifth-highest in the U.S.—although not all those workers had that choice. Nationally, businesses paying higher average wages were more likely to increase remote work.
Q: When is a drop in the unemployment rate bad news?
A: When people are leaving the <span class="glossaryLink " data-cmtooltip="
The total number employed plus the total number of unemployed as measured by U-3.
“>labor force rather than going back to work.
The official monthly <span class="glossaryLink " data-cmtooltip="
Total number of people working, including farm workers and the self-employed, as reported on a monthly survey of households by the U.S. Bureau of Labor Statistics.
“>employment numbers for August were released last Friday by the U.S. Bureau of Labor Statistics (BLS). Vermont’s reported unemployment rate fell from 8.3 percent in July to 4.8 percent in August.
That would normally be great news. Fewer unemployed means more people have gone back to work, right?
But that’s not what happened last month. In fact, the BLS reported that the number of employed Vermonters dropped more than 2000 between July and August. During the same period, the number of unemployed Vermonters fell by nearly 13,000.
What happened to 15,000 workers who suddenly were neither employed nor unemployed?
The answer to this question has to do with BLS definitions and one of the many quirks of this pandemic.
BLS employment statistics are taken from surveys that ask individuals about their work status. Individuals are considered to be in the labor force if they either are 1) employed or 2) unemployed, which is defined as available for and actively seeking work.
The problem is that in the interest of public health during the COVID-19 emergency individuals have been encouraged not to work, may be concerned about the safety of going to work, or cannot work because they need to care for others such as children who would normally have been in school or daycare. Yet these unemployed individuals may be receiving unemployment benefits as the state has dropped the work-search requirement.
The result is that thousands of Vermont workers do not fit the definition of unemployed because they are not actively seeking work and are no longer counted as being in the labor force.
According to Vermont Labor Commissioner, Michael Harrington: “Knowing that the actual number of Vermonters filing weekly for unemployment benefits remains much higher than the survey data, and that traditional work search requirements have been suspended, we know that the results of the <span class="glossaryLink " data-cmtooltip="
All the people who occupy a housing unit as their usual place of residence.
“>household survey do not accurately reflect Vermont’s economic reality.”
Tens of thousands of Vermonters are still unemployed and need support, which is why Congress needs to reinstate federal pandemic unemployment benefits. That support should continue until a falling unemployment rate means Vermonters really are going back to work.
Source: Public Assets Institute, Montpelier. 12.18.2020
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