Falling Georgia jobless claims a sign of the (good) times

With hiring steady and jobless claims down to pre-pandemic levels, WorkSource Fulton's North Fulton career center has reopened to in-person services to help individuals looking for new job opportunities. (Courtesy Pixabay)

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With hiring steady and jobless claims down to pre-pandemic levels, WorkSource Fulton's North Fulton career center has reopened to in-person services to help individuals looking for new job opportunities. (Courtesy Pixabay)

Not long ago, Georgia’s new jobless claims number was a weekly snapshot of a pandemic-damaged economy and a struggling labor market.

But the number of claims for unemployment benefits has fallen from the stratosphere to pre-pandemic levels.

Part of the reason is that some Georgians are no longer eligible after receiving payments earlier in the pandemic. Georgia opted out of the federal programs in June and many people covered by state programs have exhausted their eligibility.

But the steep downturn in claims also reflects a surging economy with lots of job openings.

The state’s Department of Labor processed 2,433 initial jobless claims in the week before Christmas and has averaged 3,226 during the past four weeks. That is not much different from February 2020, when the weekly average was 5,524 claims.

It’s a far cry from April of last year, when claims reached nearly 400,000 one week, and the summer and early fall of 2020, when they still topped 50,000. Weekly claims regularly exceeded 20,000 for the first half of this year, and were still roughly twice as high as pre-pandemic levels in September.

While inexact, the long slide in jobless claims is near-proof of a dramatic economic recovery, with job growth far outpacing job cuts, said Mark Butler, the state’s labor commissioner.

Since hitting bottom in April 2020, Georgia has added 561,800 jobs as the unemployment rate dropped to a record low of 2.8% last month. That rate only includes people looking for a job, but those jobseekers are outnumbered by job openings, according to the Department of Labor.

“I wish we had a cloning machine so we had people who could fill all the open jobs,” Butler said.

Many companies say they cannot fill the jobs they have, while the bidding for employees has meant higher wages for many positions, especially in blue-collar and service jobs. Some potential workers are not actively seeking jobs despite the rebounding economy, with potential reasons ranging from health concerns to child care issues, although recent research indicates the biggest component might be early retirements.

Which in general means few layoffs and — when it does happen — a pretty quick search for the worker to find another job.

“I think it’s pretty clear that the labor market is incredibly tight,” said labor economist Ian Schmutte at the University of Georgia. “While job growth could be a little stronger, it is a lot stronger than after the Great Recession.”

Since the start of the pandemic, the state has processed 5.1 million applications for jobless benefits, a little more than one-third of them judged to be valid. Many have been caught up in months-long appeals processes, exacerbated by the inability of claimants to reach labor department workers. Others were duplicates, attempts at fraud or mistakes.

The Department of Labor took considerable criticism for being slow to process claims or handle appeals and sluggish to ramp up in response to the crisis. Officials have said that — like many employers — the department was plagued with resignations, while also finding it hard to locate and train new workers.

But the state has made $23.2 billion in benefit payments during the pandemic, $4.9 billion of that from state programs. Those payments helped prevent the kind of homelessness and hunger feared at the start of the outbreak. And the economy started churning out jobs.

Much of the money went to Georgians who had filed under federal programs that were aimed at softening the blow for workers hurt by the spread of COVID-19. Those programs, which for a time padded benefits by several hundred dollars a week, included help for people who were not eligible for state benefits, like self-employed or gig workers.

In June of this year, when Gov. Brian Kemp cut off participation in the federal programs, nearly 350,000 people were receiving benefits, more than half of them from federal payments.

That leaves state eligibility rules roughly as they were pre-pandemic, with self-employed, contractors and gig workers not covered. Claimants who do qualify can receive up to 26 weeks of benefits which could range from $55 to $365 per week.

News about jobless claims is often viewed as a real-time snapshot showing the level of layoffs. And many people who are laid off file claims in the following week or two, but there is a lot of noise along with the signal.

According to Butler, up to 90% of claims are currently filed by people who were not legitimately laid off.

Many who file for benefits are not eligible because they quit or were fired for cause, he said. “The percentage of people filing claims who were not laid off is very high. Before the pandemic, it was high, but not this high.”

Some claims are also made fraudulently, the attempts of thieves and scamsters to steal taxpayer dollars with false claims.

“The pandemic and the creation of all the federal programs opened the eyes for a lot of crooks out there about the unemployment system,” he said. “And just because the federal programs go away doesn’t mean those people have gone away.”

But the overall trajectory of claims does track the economy — falling as the economy rebounded.

And if anything, the claims number is too pessimistic, Butler said, citing the number of layoffs reported in recent weeks under the Worker Adjustment and Retraining Notification Act, or WARN. “WARN is almost nothing.”

Georgia weekly initial jobless claims

Highest, pre-pandemic: 41,522 (Jan. 10, 2009)

Pre-pandemic average: 5,906 (Jan. 2019-Feb. 2020)

Highest, during pandemic: 390,132 (April 4, 2020)

Most recent: 2,433 (Dec. 18, 2021)

Average, July: 14,446

Average, August: 10,385

Average, September: 6,889

Average, October: 6,232

Average, November: 3,832

Most recent month above 10,000: Aug. 14, 2021 (11,157)

Most recent month above 50,000: Sept. 5, 2020 (50,320)

Most recent month above 100,000: July 18, 2020 (122,313)

Sources: U.S. Employment and Training Administration, Georgia Department of Labor

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