Largest state unemployment rate jump in 30 years still undercounts increase

DOVER — Delaware’s unemployment rate jumped from 3.9 percent in February to 5.1 percent in March, the largest month to month increase since September 1990. But even that figure, which also represents the highest rate since January 2015, undercounts the true impact of the coronavirus.

“When the data is collected it is collected for the reference period that includes the 12th of the month,” Tom Dougherty, the chief of the Office of Occupational and Labor Market Information, wrote in an email. “In this case, it was from March 8th through the 14th.

“Continued claims are used as an input in the calculation of the unemployment rate. And most of the impact from the coronavirus occurred the week following the reference week. That is why you are not see the full impact.”

In other words, there will be a larger jump in April. Based on the unemployment claim data, it’s probably going to be a much larger jump.

According to the Delaware Department of Labor, almost 62,000 workers sought unemployment benefits from March 15-April 11, nearly double the number of claims the state saw in all of 2019.

Delaware announced its first coronavirus case on March 11 and quickly began closing businesses and limiting public gatherings. It has expanded unemployment to cover more people as a result, while a federal supplement has provided extra money for recipients.

Nationally, the unemployment rate increased from 3.5 to 4.4 percent last month, the largest bump since January 1975. However, about 22 million Americans have sought unemployment benefits from March 15-April 11, implying the rate is likely much higher.

Locally, the number of employed individuals fell from 470,000 to 453,800, while the number of those without a job saw a bump from 19,200 to 24,500, according to the department’s estimate. Though the number of unemployment claims seems to imply the percentage of Delawareans out of work could easily be in double digits, the claims total actually captures those who work in Delaware, not state residents.

The U.S. Department of Labor also cautions against using unemployment claims as a strict proxy for unemployment rate.

“Every week, the Department of Labor’s Employment and Training Administration (ETA) reports the number of people filing initial and continuing claims for UI benefits. Because the UI claims data are a weekly series, they can capture the impact of shocks more quickly than the BLS monthly household and establishment surveys, particularly when these shocks hit between survey reference periods,” states the Bureau of Labor Statistics’ website.

“Data users must be cautious about trying to compare or reconcile the UI claims data with the official unemployment figures gathered through the household survey. The unemployment data derived from the household survey in no way depend upon the eligibility for or receipt of unemployment insurance benefits.”

Still, April figures to see the unemployment rate skyrocket as the United States battles its biggest economic crisis in at least a decade (and possibly more like 80 years).

Helpful Coronavirus links

Delaware Division of Health Coronavirus Page
CDC: About the Coronavirus Disease 2019
CDC: What to do if You Are Sick
Johns Hopkins Coronavirus Resource Center
AP News Coronavirus Coverage
Reopening Delaware: Resources for Businesses
Delaware Phase 2 guidance

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