For the first time, we are able to analyze the reemployment patterns of UI claimants during the pandemic.
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Of the 2 million UI Claimants in CA who were laid off in 2020q2 & experienced a "full separation" from their employers, (i.e., they weren't just working reduced hours), nearly 40% remained totally unemployed (registering $0 in earnings) for the rest of the year.
(Q3 and Q4 2020)
45% of UI claimants had been recalled to their prior employer by the end of the year.
Some groups were less likely than others to be recalled, including:
-Lower Educated workers (41%)
-Black workers (37%)
-Younger workers (Gen Z) (40%)
There are substantial differences in the rate of recall between industries. Workers from Management & Manufacturing saw the highest rates of recall (63%, 64%), while Accommodation & Food Services + the Admin. Support/Waste Mgmt industries saw lower rates of recall. (43%, 35%)
We also shed light on recent trends in the total number of people receiving UI benefits each week.
The total # of Californians receiving regular UI benefits fell by 850,000 people in the Spring, from 2.3m in early March to under 1.5m in May.
What drove this sudden decline?
52 weeks after a claim begins, claimants reach the end of their "benefit year".
Once this happens, they cannot continue receiving payments until they file a new claim- even if they have weeks remaining on their original claim. edd.ca.gov/about_edd/coro…
We find that in CA, UI claimants are *MUCH* more likely to exit the UI system in the week their benefit year ends.
(Notice the decline in the # of claimants has been heavily concentrated in the PEUC & EB programs- claimants who started their benefit year last Spring.)
So how big of an issue is the end of a benefit year?
Consider this:
In the 11 weeks between March 13 2021 & May 22nd, (~1 yr after the start of the crisis), 51% of the 850,000-person decline in the # of claimants in CA was due to claimants reaching the end of their benefit year.
This issue may not be limited to CA: All states have benefit years which require claimants to file trans'l claims to continue receiving benefits.
W/o access to other states' admin. data, it is unclear how many claimants in other states may have similarly been pushed out of UI.
One year ago today, @CAPolicyLab's "UI Team" released its 1st Report.
We partnered with @CA_EDD to analyze CA's administrative data on UI claimants, focusing on the nature of the crisis & how it was affecting workers in near real-time.
Today, we review our 10 biggest takeaways:
1) As the crisis dragged on, Benefit extension programs such as PEUC and FED-ED (aka EB) have become increasingly important in supporting unemployed workers.
SEVENTY PERCENT of regular UI claimants receiving benefits in April 2021 were on an extension program.
2) The COVID-19 crisis hit the hospitality and food services sector hardest.
Through this mechanism (and others), it has disproportionately impacted less educated workers, workers of color, and women.
Since March, we've written 8 reports analyzing the UI system + trying to explain how many people are receiving UI benefits.
Now we ask a different question:
Who has the UI system left behind?
We want to know who is “missing out” on UI.
i.e., "Who is unemployed, but isn’t receiving UI benefits?"
It’s hard to judge the trade-offs between UI extensions and other forms of economic relief without being able to say something about this question.
To attempt to answer this question, we took a geographic approach:
We calculated the number of people receiving regular UI benefits in each neighborhood, and compare it to local estimates of unemployment.
(see techn. appendix for details)
Me, @TillvonWachter, @alexbellecon & Geoff Schnorr take a deep dive into the recent #UI claims data to shed some light on what’s actually happening in CA’s labor market.
In late August, initial claims for PUA skyrocketed, while EDD expressed concerns of a surge in fraudulent PUA claims. There was also a slight increase in initial claims for regular UI.
BUT...
Prior to this, CA saw 5 consecutive weeks of a decrease in new initial claims. (2)
Coinciding with this surge in initial PUA claims was a change in the demographic profile of PUA claimants- Recent claimants are more likely to be male, white, and self-employed than earlier PUA claimants - whether or not this is driven by fraudulent claims isn’t totally clear (3)
New @CAPolicyLab Report:
Me, @TillvonWachter, @alexbellecon & Geoff Schnorr break down the rise in "Initial" Unemployment Insurance Claims (and much more)
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The recent growth in Initial Claims has largely been driven by an increasing number of additional claims —claims which are reopened after a claimant’s temporary return to work.
The number of truly *new* initial claimants has been flat since May — but at historically high levels
These "additional" claimants, who are experiencing *another* layoff, are different than new initial claimants.
We show that relative to the group of new claimants, additional claimants are more likely to be women, younger workers, and in Food Services