If there were any doubts that the coronavirus pandemic is pushing Washington’s economy into new and dangerous territory, they were put to rest by Thursday’s unemployment numbers.
According to the latest report by the state Employment Security Department, (ESD) more than 133,000 Washington residents filed for jobless benefits last week — an increase more than ninefold from a week earlier — as the shutdown of nonessential commercial activities to halt the pandemic also slows the state’s economy.
“We haven’t seen anything like this in volume and velocity [of claims] in the history of the unemployment insurance program — and that goes back [to] 1930, when it started,” said ESD commissioner Suzi LeVine during a conference call with reporters Thursday morning.
By comparison, LeVine said, the number of claims last week — 133,464 — was more than five times higher than in any week during the Great Recession. Across the United States last week, 3.283 million Americans applied for unemployment benefits — almost five times the previous record set in 1982 — up from 282,000 during the previous week, according to the U.S. Labor Department.
The surge led Gov. Jay Inslee to suggest during a press conference Thursday that Washington and other states will need help from the federal government that is “significantly more” than the $2 trillion stimulus package moving through Congress.
Washington’s record-setting numbers could themselves be eclipsed as the economy absorbs new government restrictions, including Inslee’s stay-at-home order, as well as additional business closures, such as Wednesday’s two-week shuttering of Boeing’s plant in Everett. Based on claims filed so far this week, “I have a feeling you’re going to continue to see a large amount of growth,” said Steven Ross, ESD director of labor market information.
Jobless claims in Washington continued to be highest for workers at restaurants, hotels and other businesses in the accommodation and food services sector, which was among the first to be hit as consumers and businesses began pulling back from public-facing activities. Last week, the sector saw 41,309 new claims statewide, up more than tenfold from the week before, according to state data.
And while King County continued to lead the state for total number of new claims, with 37,296, compared to 5,834 the prior week — Spokane County saw the largest percentage jump, from 455 to 8,766, for an increase of nearly twentyfold. “What we are seeing … is a wave across the state,” LeVine said.
Soaring jobless claims here and elsewhere added new urgency to emergency federal legislation that Congress is expected to enact this week, which includes a large funding increase to cover soaring unemployment claims.
The new claims have overwhelmed the state’s unemployment insurance system, which is being updated to handle coronavirus-related layoffs. Many individuals have had their unemployment claims denied, sometimes without explanation. Others haven’t been able to get through on the department’s helplines, which are often so busy that callers are hung up on.
“You can’t even get put on hold,” said Erin Flemming, a Seattle resident who is helping a friend file a claim. “It’s just various voicemails … all saying to ‘hang up and try again.'”
The sharp increase in claims also brings new worries for people who were already out of work and now face more competition for a shrinking number of job openings.
“It’s a little unnerving,” said Sharone Larson, an unemployed 58-year-old from Maple Valley, about a local job market that seemed be improving earlier this year but is now “flooded with a whole bunch more people looking for work.”
That flood shows little sign of abating. Because Thursday’s report covered claims that were filed before Inslee’s order on Monday closing all “nonessential” businesses, claims are likely to keep rising this week, said Ross, of the ESD.
Indeed, this week brought a torrent of new layoff notices from employers across Washington. On Wednesday, Seattle-based Nordstrom informed employees that it was furloughing some corporate staff for six weeks and extending the closure of retail locations through April 5, according to an internal email.
“This is the most difficult decision we’ve made in our company’s long history,” wrote brothers Erik and Pete Nordstrom, CEO and president, respectively.
There were also signs that last week’s tally of jobless claims, for all its magnitude, might be understating the total impact of the coronavirus pandemic on Washington’s job market.
That’s partly because some residents haven’t been able to file claims due to technical problems at the ESD. But it’s also because some workers, such as gig workers, freelancers and the self-employed, are often ineligible for benefits under the state’s current unemployment system and may not be applying — even though their incomes have also plunged due the pandemic.
“I’m getting almost no work, so it’s very scary,” said one Seattle-area worker in a message to The Seattle Times. But, added the worker, “I’m a gig worker/independent contractor, so I’m ineligible to receive unemployment.”
But Thursday’s report also brought more encouraging developments.
LeVine said the ESD is addressing software problems, plans to add as many as 1,000 new workers, and is expanding its hours to include weekends and early mornings. “We are as a team working around the clock to expand the capacity of our systems to respond to this increased need for employment benefits,” LeVine said.
LeVine also pointed to provisions in the proposed federal legislation that target gaps in state unemployment programs. For example, gig workers and others whose claims are denied under the state’s unemployment insurance program would be covered under a so-called pandemic unemployment assistance program, LeVine said.
The federal legislation also adds a weekly payment of $600 on top of existing state unemployment insurance payouts and extends existing unemployment benefits by 13 weeks, which in Washington means unemployed workers will get up to 39 weeks of benefits. (Congress offered a similar expansion during the Great Recession, when the average claim in Washington state peaked at 42 weeks, in 2010, according to data from the state Employment Security Department.)
Still, many questions remain unanswered. Department officials aren’t sure how long it will take before the new federal benefits start flowing to Washington workers, given that the new programs in the stimulus bill still must be developed by the Labor Department and implemented by each state. “All of those pieces are going to take a little time for us to stand up in our IT system,” said Dan Zeitlin, director of the ESD’s data systems.
Nor was it clear how long it would take the department to staff its helpline so that unemployed people would be able to get assistance instead of a busy signal. As of 3 p.m. Thursday afternoon, Flemming said, her friend could get only as far as an automated system that asked for account information, but then announced that the “claim center is currently closed,” even though the stated hours are 8 a.m. to 4 p.m.
The delays have left many unemployed workers plenty of time to reflect on circumstances that few could have imagined.
Larson, the Maple Valley resident, said the lack of a job combined with the isolation of self-quarantine has made her focus on “what’s really important in my life and what I can do without.”
Others were less philosophical.
“I live with nine other people, and all but one of us have lost jobs as a result of the virus,” said the contract worker. “We pool more resources now, and have rules about how we behave when we leave the house, and sanitizing upon returning. No guests. Everything has changed.”
Seattle Times Traffic Lab engagement editor Michelle Baruchman and The Associated Press contributed to this report.