Bulk of jobless claims are due to repeat pandemic layoffs, say researchers


Airline industry workers hold signs during a protest in Federal Plaza in Chicago, Illinois, on September 9, 2020.

KAMIL KRZACZYNSKI | AFP | Getty Images

Most new claims for unemployment benefits are coming from repeat layoffs, according to new research, hinting at unstable work prospects for a broad swath of Americans and signaling another dimension of pain in the labor market nearly a year into the pandemic.

Almost 2 in 3 workers who began receiving benefits in October had collected them at least one other time since April, according to a paper by economists at the University of Chicago and JPMorgan Chase Institute.

That might happen, for instance, if a restaurant closed, re-opened, then closed again — translating to fresh layoffs with each closure.

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The report offers the first national glimpse at how many workers have had to rely to the social safety net multiple times amid elevated Covid infections and regional business shutdowns to contain the outbreak.

“Repeat unemployment is a serious issue,” said Peter Ganong, an economist at the University of Chicago and a co-author of the report. “There’s deep distress in the labor market.”

‘Especially unstable’

The share of workers who’ve suffered many layoffs — and drew more than once from unemployment funds — grew steadily last year through October, according to Ganong and his co-authors. The share was 61% in October.

Together, the high prevalence of long-term unemployment and repeat job loss points to more instability in the labor market than may be apparent from federal economic data, they said.

The Labor Department, which updates data on unemployment benefits every week, doesn’t provide a detailed breakdown of the workers who collect benefits, for example.

“Among those who have not been continuously unemployed, the typical experience has been one of repeated unemployment,” they wrote. “Many of the workers who were recalled in the summer were laid off again in the fall.”

Findings in the paper generally track with granular data at the state level.

In California, for instance, 77% of all new benefit claims the last week of November were from “additional claims,” according to the California Policy Lab.

An additional claim is triggered by a repeat pandemic layoff, after a worker returns to work and subsequently needs to re-open an old claim.

In some hard-hit industries, almost all new claims are from repeat layoffs.



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